Homeloans reintroduces 95% LVR product
A substantial development for the broker market
Mortgage provider Homeloans Ltd has relaxed its lending criteria and is reintroducing lending of up to 95 per cent LVR – for the first time in over 18 months.
Homeloans general manager of third party sales, Tony Carn, calls the move a “substantial development in the mortgage market – and particularly the Australian broker market.”
“There has been a real shortage of home loan options in this space in recent times. And those on offer through the major banks are available on a limited basis,” Carn says.
Lending above 90 per cent accounted for a substantial percentage of total lending prior to the global financial crisis, so renewed access to this market is a considerable boost for home borrowers.
“For some bank lenders, 95 per cent lending is only available to existing customers of the bank,” Carn says. “However, in effect this has limited accessibility of lending at this level through the broker channel as many applicants may have preferred to deal directly with the bank. A key reason why we see this as a substantial initiative is that lending up to 95 per cent is now available to approved applicants irrespective of where they currently do their day-to-day banking.
“In addition, other lenders only provide access to 95 per cent lending through a limited number of brokers on their panel who meet certain criteria. And this can often prevent customers accessing their loan through their selected broker.”
New product names
Homeloans’ new credit policy coincides with the launch of new product names on Homeloans’ products. The Balanced Special, Hassle Free Loan and MoniPower Line of Credit products will now all be known as the Homeloans MoniPower range. The Homeloans Premium range becomes Homeloans Ultra, and the Smart Saver will now be known as the Homeloans ProSmart.
The new 95 per cent LVR credit policy applies to the MoniPower full doc loans of up to $750,000 in certain locations. It is available to owner-occupied homes, including new properties and construction loans. The MoniPower provides a competitive variable interest rate set below all the major bank standard variable rates, as well as a range of competitive fixed rates starting as low as 6.91%. It provides a 100 per cent offset home loan which also offsets interest on fixed rates, and comes with no monthly or annual fees.
Homeloans has also announced that approved applicants can now access a Visa card with a secured limit of $20,000 or $10,000 unsecured. This allows home buyers access to additional funds which can be crucial to help them meet additional costs associated with a home purchase.
“This move clearly reinforces to borrowers and brokers alike that Homeloans is a very competitive and real alternative lending partner,” Carn adds.