ANZ has moved to tighten lending standards for higher value properties in a bid to safeguard itself and customers from the deteriorating economic conditions.
Effective today, for homes valued by the bank at $2 million or more ANZ’s maximum LVR will reduce from 80 to 75 per cent.
Under ANZ’s changing standards more thorough valuation checks will also apply to properties worth $3 million or more in New South Wales, Victoria and Western Australia – compared to the previous threshold of $5 million.
In other states the requirement for thorough valuation checks will also be extended to properties worth $2.5 million or more, compared to $3 million previously.
An ANZ spokeswoman told Mortgage Business this was “a prudent and measured response to the emerging economic environment and is both in the bank’s interest and our customer’s interest”.
ANZ’s decision to tighten criteria is consistent with an overall shift by banks to minimise their risk exposure in light of current market conditions.
Just last week ING DIRECT said it would reduce its maximum LVR to 90 per cent and require 5 per cent genuine savings from borrowers in cases where LMI applied.