ASB, Westpac tweak servicing tests
ASB has increased the minimum average expenses on a range of costs used to work out the amount of free cash a potential borrower has each month.
Minimum expenses per adult have increased from $600 to $610 per month. The minimum expense on rates has risen from $170 to $185 a month. While the minimum expense for utilities has risen from $265 to $275 a month, and insurance is up from $85 to $90.
The increases will slightly reduce the amount of surplus income for loan applicants. ASB told advisers about the changes on June 1.
It comes against a backdrop of New Zealand’s major banks making internal changes to tighten lending. Adviser says lenders have made servicing assessments, or “stress tests”, more difficult.
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