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Resimac tightens LVR policy

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Charbel Kadib 6 minute read

The non-bank has introduced restrictions on the maximum loan-to-value ratio required for loans secured by an apartment or unit in response to weaker property market conditions.  

Resimac has announced changes to its maximum loan-to-value ratio (LVR) requirements for borrowers applying for a Resimac Prime or Resimac Specialist with an apartment or unit as a security, effective Monday, 24 December.

Resimac claimed that its decision was made following a “review of current property market trends and the general property outlook”.

According to CoreLogic, national home values fell by 4.1 per cent in the year to 30 November 2018, with apartment values dropping by 2.5 per cent over the same period.

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Resimac has announced the following location-based restrictions to apartments and units:

Victoria – all postcodes

  • Resimac Prime Insured – no restriction provided [lenders mortgage insurance/LMI] can be obtained (borrower to pay in all cases)
  • Resimac Prime Uninsured – the maximum LVR will be 70 per cent on apartments and units
  • Resimac Specialist – the maximum LVR will be 10 per cent less than the product maximum on apartments and units

New South Wales – all postcodes

  • Resimac Prime Insured – no restriction provided LMI can be obtained (borrower to pay in all cases)
  • Resimac Prime Uninsured – the maximum LVR will be 70 per cent on apartments and units
  • Resimac Specialist – the maximum LVR will be 10 per cent less than the product maximum on apartments and units

Queensland – inner city postcodes as defined by Resimac*

  • Resimac Prime Insured – no restriction provided LMI can be obtained (borrower to pay in all cases)
  • Resimac Prime Uninsured the maximum LVR will be 70 per cent on apartments and units
  • Resimac Specialist – the maximum LVR will be 10 per cent less than the product maximum on apartments and units

Northern Territory – postcode 0800

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  • Resimac Prime Insuredno restriction provided LMI can be obtained (borrower to pay in all cases)
  • Resimac Prime Uninsured – the maximum LVR will be 70 per cent on apartments and units
  • Resimac Specialist – the maximum LVR will be 10 per cent less than the product maximum on apartments and units

Australian Capital Territory – postcode 2600 to 2612

  • Resimac Prime Insured no restriction provided LMI can be obtained (borrower to pay in all cases)
  • Resimac Prime Uninsured – the maximum LVR will be 70 per cent on apartments and units
  • Resimac Specialist – the maximum LVR will be 10 per cent less than the product maximum on apartments and units

Australian Capital Territory – all other postcodes outside 2600 to 2612

  • Resimac Prime Insured – no restriction provided LMI can be obtained (borrower to pay in all cases)
  • Resimac Prime Uninsured – the maximum LVR will be 5 per cent less than the product maximum on apartments and units
  • Resimac Specialist – the maximum LVR will be 5 per cent less than the product maximum on apartments and units

Western Australia – postcode 6000 to 6005 and 6100 to 6103

  • Resimac Prime Insured – no restriction provided LMI can be obtained (borrower to pay in all cases)
  • Resimac Prime Uninsured – the maximum LVR will be 70 per cent on apartments and units
  • Resimac Specialist the maximum LVR will be 10 per cent less than the product maximum on apartments and units

Western Australia – all other postcodes outside 6000 to 6005 and 6100 to 6103

  • Resimac Prime Insured – no restriction provided LMI can be obtained (borrower to pay in all case
  • Resimac Prime Uninsured the maximum LVR will be 5 per cent less than the product maximum on apartments and units
  • Resimac Specialist – the maximum LVR will be 5 per cent less than the product maximum on apartments and units

Resimac noted that the restrictions do not apply to its Resimac Ultra Plus, MoniPower or Accelerate products.

Resimac added that its Prime and Resimac Specialist Acceptable Property Location tool will be updated in due course.

[Related: Non-bank tightens expense reporting obligations]

Resimac tightens LVR policy
tight lending cash ta
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Charbel Kadib

Charbel Kadib

Charbel Kadib is the news editor on The Adviser and Mortgage Business.

Before joining the team in 2017, Charbel completed internships with public relations agency Fifty Acres, and the Department of Communications and the Arts.

Email Charbel on: This email address is being protected from spambots. You need JavaScript enabled to view it.

 

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