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Major bank slashes floor rate
A big four bank has updated its home loan serviceability assessment policy for the second time in response to APRA’s regulatory amendments.
Major bank slashes floor rate
A big four bank has updated its home loan serviceability assessment policy for the second time in response to APRA’s regulatory amendments.

ANZ has announced that it will decrease its interest rate floor for home loan serviceability assessments from 5.5 per cent to 5.25 per cent.
The changes, which will be effective for all applications from Monday, 17 February, have come in response to the Australian Prudential Regulation Authority’s decision to scrap its 7 per cent interest floor and raise its sensitivity buffer to 2.5 per cent.
ANZ was the first major lender to implement the changes in July last year, when it reduced its interest rate floor for home loan serviceability assessments from 7.25 per cent to 5.5 per cent. It also increased its sensitivity buffer from 2.25 per cent to 2.5 per cent.
In the latest update to brokers, ANZ said its sensitivity margin remains at 2.5 per cent.

In explaining the reason behind the change in its floor rate, ANZ said: “To ensure ANZ remains in line with community expectations by applying appropriate tolerances when assessing serviceability, ANZ has reviewed the floor rate used for calculating serviceability.
“As a result, ANZ will reduce the minimum floor rate to 5.25 per cent.”
The bank said all new and existing applications for residential lending will have the new floor rate applied as part of the home loan assessment process. The new floor rate will apply to:
- ANZ home loans
- ANZ residential investment loan
- ANZ Simplicity Plus Home Loan
- ANZ Simplicity Residential Investment Loan
- ANZ/OFI Line of Credit (limit)
- Other financial institution (OFI) home or investment loan facilities
ANZ has joined the Commonwealth Bank of Australia, Auswide, Heritage Bank and Westpac in revising its serviceability rates twice in response to APRA’s changes to its home lending guidance.

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