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CBA changes serviceability calculations

by Reporter10 minute read

A big four bank has changed its serviceability calculations for new owner-occupier and investment home loans, as well as line of credit applications. 

Commonwealth Bank has announced that it will be changing the way it assess serviceability for existing home loan customers wishing to take out a new loan.

For any existing CommBank owner-occupier/investment home loan, line of credit, and business loan repayments, the bank will now apply an interest rate buffer of the higher of either 7.25 per cent p.a. or the current product interest rate plus 2.25 per cent p.a. (less any existing interest rate concessions).

The bank also said it would apply a servicing loading of 30 per cent for existing other financial institution (ofi) owner-occupier/investment home loan, line of credit and business loan repayments.


Any applications submitted to the bank for assessment before 10 June 2017 will be honoured under the old policy. 

This includes existing Home Seeker applications, where the application converts to a full application within the original expiry term. 

Any variation from the original approval will be subject to the new serviceability calculations. 

The bank said these changes have been made to ensure that customers are able to make their repayments on their home loans, and to bring it in line with other major bank policies.

A Commonwealth Bank spokesperson said of the changes: “As Australia’s largest lender, Commonwealth Bank is committed to consistently delivering the best customer experience for home buyers, as well as meeting our responsible lending obligations.  

“As a responsible lender, we constantly review our products and services to ensure we are maintaining our prudent lending standards and meeting our customers’ needs both now and in the future.” 

[Related: CBA announces fresh lending changes]

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