One of Australia’s non-major banks has this week resumed lending to SMSF property investors.
AMP Bank will accept investor property loan applications to SMSFs effective 14 December following a temporary withdrawal from the market in response to regulatory growth guidelines.
This fulfils the bank’s commitment to return to the market in 2015 and follows its recommencement of non-SMSF investor property lending on 16 November.
AMP’s decision to withdraw from the investor lending space and then return this year has been met by mixed responses form mortgage brokers.
Speaking to The Adviser, Vow Financial chief executive Tim Brown said the non-major had more exposure to investment lending than many other lenders due to its high volumes of SMSF investment lending.
“They were probably the biggest in the market in that space,” Mr Brown said. “In defence of AMP, they probably didn’t have a lot of options and were probably more heavily exposed to the investment lending market than anyone else,” he said.
AMP made its exit and re-entry into the investor lending and SMSF investor lending space well known, leading many to believe they were the only lenders to take such action.
However, according to Mr Brown, other lenders under regulatory pressure chose different strategies.
“There were a number of lenders that brought in new credit policies that literally stopped them from doing any lending,” he said. “The perception might have been that they were still lending but they actually weren’t approving anything. So I think there were other lenders that had similar restrictions put on them by APRA but they hid it very well by changing policy.
“Hat’s off to AMP for being transparent. Maybe in hindsight they might have done it differently, but I think they did what they thought was right at the time.”
[Related: Brokers shocked by bank's decision]
James Mitchell has over eight years’ experience as a financial reporter and is the editor of Wealth and Wellness at Momentum Media.
He has a sound pedigree to cover the business of mortgages and the converging financial services sector having reported for leading finance titles InvestorDaily, InvestorWeekly, Accountants Daily, ifa, Mortgage Business, Residential Property Manager, Real Estate Business, SMSF Adviser, Smart Property Investment, and The Adviser.
He has also been published in The Daily Telegraph and contributed online to FST Media and Mergermarket, part of the Financial Times Group.
James holds a BA (Hons) in English Literature and an MA in Journalism.
The non-major bank has announced the appointment of a former West...
A number of regions could see a material decline in housing price...