Non-major tightens the screws on SMSF loans
One of the major SMSF loan providers will change the maximum loan to value ratio for new SMSF loans to 50 per cent from 1 July.
AMP is changing the maximum loan to value ratio (LVR) for all new investor property loans, as reported by SMSF Adviser’s sister publication Mortgage Business.
The LVR percentage will be changed to 50 per cent and apply to all new loans with an investment property as a security and includes loans to SMSFs. The change will apply from 1 July for SMSF loans, which currently have an LVR of 70 per cent.
AMP Bank also announced that variable interest rates for new and existing investment property loans will increase by 35 basis points.
The change in interest rates will apply from 23 June 2017 for new customers and 26 June 2017 for existing customers. AMP confirmed that the variable rate change also includes SMSF loans.
AMP Bank group executive Sally Bruce said the measures are needed to ensure AMP operates within its regulatory obligations.
“We’re committed to managing our portfolio responsibly while balancing this with the interests of our customers,” she said.
“We are managing our loan book in a very active market and these changes follow recent shifts in competitor activity. We will continue to take the necessary steps for sound management of our regulatory requirements.”
Miranda Brownlee is the deputy editor of SMSF Adviser, which is the leading source of news, strategy and educational content for professionals working in the SMSF sector.
Since joining the team in 2014, Miranda has been responsible for breaking some of the biggest superannuation stories in Australia, and has reported extensively on technical strategy and legislative updates. Miranda has also directed SMSF Adviser's print publication for several years.
Miranda also has broad business and financial services reporting experience, having written for titles including Investor Daily, ifa and Accountants Daily.