ING DIRECT is the latest lender to tighten its credit policy and reduce its maximum available LVRs.
From the 20 March, ING DIRECT’s maximum LVR for LMI applications will reduce to 90 per cent.
For all applications where LMI applies, borrowers will also be required to demonstrate 5 per cent genuine savings for three months.
The lender said the changes were being made to align its policies with the current economic environment.
ING DIRECT’s policy adjustment is part of a growing trend towards more conservative lending practices and follows similar changes in recent months from some of the major banks.
In November last year, ANZ said it would reduce its maximum LVR to 90 per cent while more recently CBA announced that it would cut its maximum LVR to 95 per cent.
CBA now also require a 3 per cent self-funded deposit from first home buyers in a bid to safe guard borrowers from pressure when rates rise.