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NAB updates tailored home loan

by Kate Aubrey5 minute read

National Australia Bank has announced brokers will have “greater transparency” following changes to its tailored home loan products, which include four new LVR tiers.

The updated Tailored Home Loan, which launched on Monday (25 July), introduces four new Loan-to-Value ratio (LVR) pricing tiers for new standalone Tailored Home Loans.

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The four new LVR tiers apply to any new standalone tailored home loan and include: Tier 1 (60 per cent or less), Tier 2 (60.01–70 per cent), Tier 3 (70.01–80 per cent), Tier 4 (80.01 per cent or more).

The four LVR tiers would be associated with each fixed-rate term for fixed-rate home loans.

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For example, a one-year fixed rate home loan will now have four tiers, as will the second and third-year terms.

Other features include access to a 100 per cent offset account on variable loans and fee-free redraw of $500 or more on variable loans.

In addition to the existing features of no annual fee and a monthly fee of $8 per loan, NAB had also permanently removed the application fee, saving its customers approximately $600.

The tiered rates are available in both aggregator software and on the NAB Broker website.

Given house prices surged more than 20 per cent in 2021 NAB said the new structure will provide “better rates” for NAB customers with large deposits or more equity in their property.

Executive of broker distribution, Phil Waugh, said the loans can be used for owner-occupier and investor lending as well as construction.

“The tiered LVR offering through our tailored home loans builds on NAB’s commitment to bringing clarity, transparency and simplicity to home lending and makes it easier for brokers to support customers in achieving their home ownership dreams.

"The refreshed product focuses on lower fees for customers, which we know is important in the current market.”

Mr Waugh said NAB was excited to be able to offer more competitive rates to customers with lower LVRs through its tailored home loan. 

He encouraged brokers to work with their customers to calculate their LVR before submitting a request through NAB’s Instant Pricing Tool.

“Rates available for each type of loan will be more transparent and brokers will have the flexibility to choose between fixed and variable rate options, or to split their loan into portions.”

“At NAB, we are committed to making it easier, simpler and faster to access our home loans products in this active, dynamic, and resilient property market,” he said.

As the big four bank focuses on its broker channel, it also recently announced a new broker-specific funding line, which will provide up to 100 per cent of funding for the purchase of broker businesses and their goodwill.

Funds are available for purposes such as acquisition and succession funding, partner payouts, refinancing, and working capital.

[Related: NAB rolls out funding for brokers]

 

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Kate Aubrey

Kate Aubrey

AUTHOR

Kate Aubrey is the senior content producer of The Adviser and Mortgage Business. Previous to joining Momentum Media, Kate covered regional and breaking news for ABC Radio.

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