The major bank has extended its internal debt cancellation process for home loan applicants to business facilities and personal overdrafts.
Westpac Group has announced that as of 10 March 2020, its internal debt cancellation (IDC) process for home loan applications will be extended to Westpac and St. George business facilities and personal overdrafts.
At present, the IDC process only applies to Westpac credit cards, personal loans, flexi loans and equipment finance.
The group has also announced that a new limit reduction process will be introduced, which will authorise Westpac to repay and reduce limits for credit cards, flexi loans, business facilities, and personal overdrafts.
The new limit reduction process will also apply to St. George credit cards, “Get Set” loans, business facilities, and overdrafts.
The group stated that where the reduced credit card limit required is below the product minimum, brokers should discuss options with the customer, which may include reducing the loan amount to the minimum product limit, requesting the liability be cleared with the new loan funds and closed, or advising the customer to request a product switch.
This is the latest of several changes to Westpac’s consumer credit policy in recent months.
Last month, Westpac updated its consumer credit policy to use comprehensive credit reporting (CCR) information in the assessment of new home loan applications and loan increases.
The changes include:
- The use of CCR information to help verify an applicant’s liabilities and identify mismatches. Brokers can help by accessing their client’s credit report with their consent and raise any liability mismatches with the client immediately.
- Requiring brokers to discuss any recent enquiries from the last two months to see if the application proceeded;
- No longer requiring statements to verify certain liabilities where CCR information is listed on the credit report; and
- Using repayment history information as part of the lending decision.
The group said the changes are required to ensure it continues to apply responsible lending practices in assessing a customer’s ability to service existing and proposed debts.
Westpac’s updated policy was effective from 16 February.
[Related: Westpac integrates CCR, update loan process]