APRA proposes amending guidance on mortgage lending

APRA proposes amending guidance on mortgage lending

The Australian Prudential Regulation Authority (APRA) has begun consulting on possible revisions to its guidance on the serviceability assessments that authorised deposit-taking institutions (ADIs) perform on residential mortgage loan applications. In a letter to ADIs issued today, APRA has proposed removing its guidance that ADIs should assess whether borrowers can afford...

The Australian Prudential Regulation Authority (APRA) has begun consulting on possible revisions to its guidance on the serviceability assessments that authorised deposit-taking institutions (ADIs) perform on residential mortgage loan applications.

In a letter to ADIs issued today, APRA has proposed removing its guidance that ADIs should assess whether borrowers can afford their repayment obligations using a minimum interest rate of at least 7 per cent. Instead, ADIs would be permitted to review and set their own minimum interest rate floor for use in serviceability assessments.

Read the full article on this link below;

https://www.apra.gov.au/media-centre/media-releases/apra-proposes-amending-guidance-mortgage-lending