Featured Product: Resi Smartpro

With the ever-changing lending market, RESI remains your dedicated Vow Lender of choice

Product Highlights:

  • Construction up to 90% LVR
  • Investment Purchase and refinance and construction
  • Owner occupied Purchase, refinance, cash out and construction
  • No need for Genuine savings if LVR is below 90%
  • 6 months rental statements can be used as genuine savings contributions
  • FHOG can be used as funds to complete (released at slab stage construction)
  • Cash out up to $250,000 with just letter from applicant for use.
  • Vacant land purchase up to 95% LVR (90% for Investment) INC LMI
  • Flexable maternatity income policy
  • Tax debt can be refinanced as a Prime application

Acceptable income type:

  • Disability Pensions - exempt from asset/income test, i.e. Permanent Blindness
  • Widow Pensions
  • Foster Care Payments
  • Supplement Payments (related to certain pensions)
  • Defence Force Reserve Income
  • Family tax A & B (child must be under the age of 12)
  • Employee allowance, Bonus, Commissions, Overtime
  • Self employed more than 2 years
  • 6 Months Casual or contract employment
  • No Min employment term for Perm or Perm Part time applicants

Rural Security:

A Home Loan Product can be offered up to a maximum LVR 70%, subject to the following criteria being met:

  • Less than 50 hectares (120 acres) in size
  • Property not generating (or be 'intended' to generate) gross trading income of more than $20,000 per year and
  • Any debt servicing not being reliant on the trading income generated from the Rural Property

Current Smartpro Promotion:

NO ongoing fees, NO valuation fee (standard valuation), NO application fee and only $330 legal fees.

**** 2 year fixed rate now 3.17% P & I**

For any scenarios or detailed policy questions please email brokersupport@resi.com.au or call 1800 737 448 (Option 1)

Download Rate Card 29/07/2019

FBAA Message: Your Professional Indemnity (PI) Cover


Financial Abuse Declarations and you Professional Indemnity (PI) Cover

Further to my communication last week on the progress we've made with the ABA on the declarations and training obligations on brokers, it is important to ensure you understand how your Professional Indemnity Insurance acts in relation to this as well.

I have confirmed with our PI Suppliers being Insurance Advisernet Australia (IAA), that they have secured written confirmation from their insurer (Allianz Australia Insurance Ltd) that these new proposed 'confirmations' fall within the accepted definition of the role of a Finance/Mortgage Broker in arranging a loan.

As such claims arising within this area are covered by the policy, subject of course to the usual policy terms & conditions.

NOTE: For those members NOT insured via IAA you will need to urgently contact your insurance broker or insurer to get clarification on this issue before signing any required declarations to this effect.

Kind Regards, Pete
Peter J White AM
Managing Director


FBAA Message: Banks Urged to Respond More Quickly


Banks urged to respond more quickly to changing borrowing conditions and rates

The Finance Brokers Association of Australia (FBAA) has demanded banks take a more proactive stance in safeguarding the interests of borrowers, citing APRA's latest guidance on assessment rates for loans as an example.

FBAA managing director Peter White claimed many people who should qualify for a loan have been rejected because they are being assessed on advice from 2014 when the economy and interest rates were very different.

"APRA moved to correct this anomaly ten days ago but some of the banks have been slow in responding. I congratulate the ANZ for moving to a more reasonable assessment position last week and Westpac for following suit today. I urge the other majors to move as soon as possible."

On Friday ANZ announced that its current floor rate of 7.25 per cent will be amended to 5.50 per cent. Westpac moved from 7.25 per cent to 5.75 per cent and increased its buffer to 2.5 per cent.

Mr White said other banks seem to be resisting, which is holding the economy back when it desperately needs a boost. "Brokers are trying to help buyers purchase a home, but banks have been holding them ransom."

On July 5 APRA amended its 2014 guidance on residential mortgage lending, stating they now expect banks to assess loans at a rate of at least 2.5 per cent above the interest rate on the loan that is being taken out.

Previous guidance from APRA to authorised deposit-taking institutions (ADIs) was to assess home loan applications using a minimum interest rate of at least 7 per cent with most banks adopting a rate of 7.25 per cent to assess loan serviceability.

"With most lending institutions offering interest rates between three and four per cent an assessment rate on 7.25 per cent was unfair.

"As brokers it makes it more difficult to get approval and creates immense disappointment and confusion for clients if banks use outdated data to assess the suitability of average Australians to pay off their home."

Mr White said the housing market needs a boost and will get it when the banking sector learns to respond quickly to changing conditions and interest rates.

"The reduction in the assessment rate will make it easier for existing borrowers to refinance so they can escape their existing mortgage prisons because of unreasonable rates and conditions."

Major Bank Lowers Serviceability Floor

Source: mortgagebusiness.com.au By Charbel Kadib 12 July 2019

A big four bank has updated its home loan serviceability assessment policy in response to APRA's regulatory amendments.

ANZ has announced that it will reduce its interest rate floor for home loan serviceability assessments from 7.25 per cent to 5.5 per cent and increase its sensitivity buffer from 2.25 per cent to 2.5 per cent.

The changes, which will be effective for new applications from Monday, 15 July, have come in response to the Australian Prudential Regulation Authority's (APRA) decision to scrap its 7 per cent interest floor and raise its buffer to 2.5 per cent.

ANZ is the first major lender to implement changes. However, the Commonwealth Bank of Australia (CBA), NAB and Westpac have each told Mortgage Business that they're currently in the process of reviewing their policies.

A CBA spokesperson welcomed the regulatory changes, stating: "We support APRA's decision to update its guidance relating to serviceability assessment rates.

"We worked closely with APRA throughout their consultation period. We are now reviewing our serviceability rates based on the new guidance while taking into consideration our portfolio mix and risk appetite."

A NAB spokesperson also welcomed the updated guidance, adding that "now is the right time" given the "low interest rate environment".

"We consider all lending applications on a case-by-case basis and are committed to lending responsibly," the NAB spokesperson stated.

"Serviceability is assessed on a number of factors to ensure customers can make repayments both now and into the future."

Westpac also noted the benefits of the updated guidance, stating that it would assist borrowers into home ownership.

A spokesperson added: "We are reviewing our serviceability requirements and continuing to consult with APRA with a view to implementing the guidance."

Last month, Westpac preemptively revised its mortgage serviceability assessment guidelines before the reforms were finalised.

The bank announced that it would allow its credit officers to use their discretion when assessing low-risk home loan applications that did not pass the serviceability test, but reversed its decision after holding discussions with APRA.

Vownet Release: Lender Document Library

We are working on the release of a comprehensive lender document library, containing key policy, forms, calculators and other documents for each lender.

We are currently completing document upload and testing. The intended release date of this new feature is before 31 July.

Read this step by step knowledge article for more details.

86 400 Granted Full ADI Licence

It is exciting to announce that as of today, 86 400 is officially Australia's newest bank and first smartbank, having been granted their full ADI (Authorised Deposit-taking Institution) licence.

They have spent two years building their bank and the licence approval is a significant milestone on the path to public launch which is now imminent.

86 400 have expressed their gratitude to Vow Financial for the support and commitment in getting them to this point.

George Srbinovski, National Manager, Broker Distribution, at 86 400 says, "your support and commitment in getting us to this point has been greatly valued by myself and the whole 86 400 team. We look forward to our continued partnership to provide our customers a smarter alternative to the way banking is done today."

If you haven't already, join the waitlist on 86 400's website to keep up to date with their release plans and make sure you're among the first in the country to try them out. As soon as they're all set, they'll send you a special invitation code so you can download their app.