A lender has updated its credit policy to require brokers to explain the source of their clients’ “genuine savings” for high LVR loans, in a bid to ensure that it “continues to lend responsibly”.
NAB-funded wholesale lender Advantedge has announced changes to its credit policy, effective 19 November.
As well as continuing to require 5 per cent genuine contributions to be confirmed for all loans with a loan-to-value ratio (LVR) of over 90 per cent, brokers will be required to provide documentation which explain the source of a borrower’s “genuine savings” contribution and whether the funds are repayable for all property purchases.
“For all property purchases, Advantedge must understand the source of the customer’s contribution (funds to complete) and whether these funds are repayable.”
Advantedge said that it has updated its policy to “clarify the acceptable and unacceptable forms of genuine contributions”.
Acceptable forms of genuine contributions include:
Unacceptable forms of genuine contributions include:
Advantedge noted that its current policy would be applied to all new applications (including increases) submitted prior to close of business on Friday, 16 November 2018, while its new policy will be applied to all new applications (including increases) submitted after close of business on Friday, 16 November 2018.
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