ANZ pledges to lend more to investors

ANZ pledges to lend more to investors

Good news, but I wonder what it means in practical terms?

 

Nothing - most investors can't service with them They might increase their IO for investors into LMI though.

 

I liked that they did loan approvals on contract price, not valuation (not that long ago either).

 

I think I've written two loans with ANZ in the last 12 months. They do have a niche and there's nothing really bad about them, but they're nothing great either.

* Pricing is fairly average.
* Policy is very conservative in most respects.
* Serviceability is amongst the worst of all lenders in most scenarios.
* Process varys between fine and horrible, depending on the circumstances.

Overall I've no real complaints about ANZ, but no reason to recommend them either. There's a few things they do well, but most competitors match it and do better in other areas. If they want to get more business, they need to differentiate themselves which they rarely do.

 

Hi Peter,
Would be interesting to find out what your breakdown of lenders are then?

Is mainly due to Serviceability?

 

ANZ want to run the Olympic 400m after the race is over.

 

There's a lot of good about ANZ in general and they have quite a large number of niches that help certain borrower types. The overall pullback in servicing has brought most lenders in line with ANZ (broadly), so their conservative servicing isn't too far from the norm nowadays. They also weren't so harsh on the bankbook & repriced existing borrowers very well.

They also were fast and efficient at decision making, but not in 2018. Hence the credit growth figures vs market growth doesn't surprise me at all unfortunately.

ANZ lost the plot last year with some of their lending decisions & processes. In truth, it was a year were risk sentiment was at record highs, there's no real way to quantify this, but lenders in general were scared to make decisions. In this environment, ANZ's investment in their process didn't really stack up (offshoring credit).

I don't think they were well equipped in terms of credit staff to adjust risk appetites quickly, so it just led to poor decision making and a very painful credit process. In general, they would just ask questions that make no real sense & look at loans as if their private investigators searching for mistakes. The genuine lack of commonsense was quite frustrating (asking questions about things that don't matter on deals that are super strong and should be simple). The 'we're looking to do business' here attitude shifted to 'I wonder what they're hiding'. Combine that with the poorest quality credit staff, and you have a pretty bad credit experience.

I used to describe ANZ credit process as the ones with the highest walls (lending policies) but the poorest quality guards to protect it (credit assessment).

Thankfully in 2019 they seem to be far more realistic again. Quicker and smarter decisions and back to a 'open for business' attitude to decision making. A $3,500 rebate, big 4 bank & solid pricing options is always going to generate a healthy level of business. Unfortunately for them, it does mean less net interest margins though (at least on the front end). I think they'll start meeting market growth figures again pretty soon.

 

ANZ's serviceability compared to other lenders?

ING might be worse. Suncorp in some categories.

 

They have some fantastic niches - the 3 big/common ones that come to mind is one years financials on LMI lending, maternity leave policy and non resident lending.

 

https://www.smh.com.au/business/ban...nservative-in-home-loans-20190219-p50yp9.html

Bit more

 

..and a little more from ANZ's "Bluenotes": Elliott: tighter conditions ahead for mortgage markets

 

I don't like how they force you to have an unwanted ANZ credit card with at least a $6000 limit when you obtain a loan product from them.
I don't see how that would be considered responsible lending?

 

Never used them much. The back office in India always put me off. Calls at between 7.00 and 10.00 at night, poor English. Some real lost in translation stuff.

 

Haha I've woken up in the middle of the night thinking somethings seriously wrong...anz calling. Someone please put Australian clocks up on their office walls.

 

Interestingly ANZ have announced a return to 90% LVR and 10 years IO this morning - effective March 25. This is at first glance, good news...until you consider how devastating this will be to borrowing capacity when they ( and other lenders) assess the debt at 20 years P&I . Still, if you have oodles of borrowing capacity and can afford to sacrifice some in order to get 10 years IO, it will be very handy

 

@euro73 does LMI still apply?

 

LMI will still apply for anything over 80% LVR unless applicant qualifies for LMI waivers such as Medical professionals.

Cheers,
David

 

no use if you penalise IO at higher rate than p&i. i rang my bank to ask about io and they discouraged me saying its higher rate would you wanna go for it. of course no dear!

i think they wanna overkill a dead market. times long way up