Bank pulls high LVR home loan product

Teacher’s Mutual Bank (TMB), along with its related brands Firefighters Mutual and UniBank, has announced that, effective immediately, it will no longer accept applications for home loans with loan-to-value ratios (LVRs) higher than 95 per cent, before or after capitalisation of the lenders’ mortgage insurance (MI) premiums.

The bank added that the maximum LVR that it will accept is 95 per cent, inclusive of the LMI premium for the following occupations:

• ambulance officer or paramedic
• firefighter
• nurse or midwife
• police officer
• teacher or lecturer

The lender stated that for all other occupations, the maximum LVR remains at 90 per cent plus LMI.

TMB added that applications submitted prior to 6 December 2018 will still proceed as per the previous policy, with all new applications, and applications where the conditional approval has expired (i.e., 90-day approval period), will be assessed using the applicable lending policy effective at that time that the loan was submitted.

In a statement to Mortgage Business, a TMB spokesperson said that the loan facility with an LVR of over 95 per cent was designed for first home buyers (FHBs) only, adding that amid an increase in applications for the loan facility, the bank chose to “rebalance the portfolio”.

However, TMB told Mortgage Business that it “may consider re-introducing the facility” in 2019 “if scope is available”.

[Related: Bank hikes rates, reintroduces home loan fee]

Charbel Kadib is the news editor on the mortgages titles at Momentum Media.

Before joining the team in 2017, Charbel completed internships with public relations agency Fifty Acres, and the Department of Communications and the Arts.

You can email Charbel on: This email address is being protected from spambots. You need JavaScript enabled to view it.