Credit Union Australia has announced it will temporarily pause accepting applications for investor lending until further notice.
As of yesterday (5 April), CUA said it will stop accepting investor lending applications until further notice, including applicants refinancing from other financial institutions.
The changes apply to all applications for new investor loans, and also impacts applicants who have lodged investor applications that do not yet have pre-approval, conditional approval or full approval.
Chief operating officer of member services Andy Rigg explained that the lender had seen a sharp increase in investor lending volumes in recent weeks.
“We have been closely monitoring our year-on-year investor lending balance growth to ensure that we continue to lend prudently while remaining within the 10 per cent regulatory growth benchmark,” he said.
“We have observed an increase in new investor applications, particularly in response to some of the actions taken by other lenders to slow their investor growth.
“In response to the continued growth in our investor lending and forward projections of this growth, we’ve taken the decision that we need to temporarily pause new investor lending.”
CUA’s decision comes after ASIC recently announced targeted industry surveillance to examine whether lenders and mortgage brokers are “inappropriately recommending more expensive interest-only loans” and APRA’s crackdown on investor lending late last month.
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