The major bank and its subsidiaries now require brokers to submit additional Requirements & Objectives questions and declarations for certain loan types and features.
As announced earlier this month, brokers submitting loans through Westpac or its subsidiaries via their broker portals (and through aggregator software, once updated) will now be required to provide additional Requirements & Objectives (R&O) questions and declarations for certain loans in a bid to understand why the applicant has selected that loan feature, the plan for paying off the loan and the plan for paying off a loan “when an event occurs”.
The loan types and features include:
- Fixed interest rate loans
- Loans requiring lenders mortgage insurance
- Loans with interest-only or interest in advance (prepaid interest) repayments
- Lines of credit
- Loans for refinancing and debt consolidation
- Bridging or relocation loans
- Mixed purpose loans
- Non-real estate goods
Any applications that do not include the relevant questions will not progress, the banking group has warned.
Further, the banking group has outlined that some answers will not be satisfactory. For example, if an applicant says they “cannot afford principal & interest repayments at the moment” or that they “want to pay off loan sooner and gain equity in their home faster” as reasons for choosing an interest-only loan, this will not be satisfactory, and the application will not progress.
As well as these changes, brokers have been told that for non-electronic submissions for loan top-ups and home loans submitted via commercial channels, they will need to capture the customer’s R&O in new form and submit it with the loan documentation.
Westpac bankers will then review the R&O Form for alignment with the loan application and contact brokers should any further information be required.
As of Tuesday (14 November), if there are any customer changes to these non-electronic home loan or top-up requirements after initial loan submission that impacts R&O, brokers will need to update the R&O Form and resubmit it.
The banking group has also reiterated that from Monday, 8 January 2018, any changes requested to a submitted loan application must be resubmitted via ApplyOnline.
Any change to loan structure sent via email will not be acted upon after the said date.
“This will ensure that the correct R&O are captured accurately for all applications submitted and resubmitted,” the Westpac Group said.
“As a bank, Westpac is committed to Responsible Lending and meeting our conduct obligations under the National Consumer Credit Protection Act.”
Temenos applications no longer accepted
As a result of the changes, Westpac group will be unable to accept new applications from the Temenos platform, eLodge+.
Instead, brokers will be required to log onto the relevant banks' broker portal to directly submit an application.
More to come.