We’ve made changes to how we assess serviceability & are removing some LMI refunds.
Changes to how we assess serviceability
We’re updating our serviceability calculator to accommodate upcoming tax cuts, Household Expenditure Measure (HEM) values and the updated Medicare Levy low-income thresholds.
What’s changing
- Tax rates will be updated to reflect the government’s tax cuts which are effective from 1 July.
- Updates will be made to account for the new Medicare Levy low-income thresholds.
- Our Household Expenditure Measure (HEM) values will be updated from Friday 7 June to align with the latest APRA requirements.
New serviceability calculator
The latest version of the Advantedge Serviceability Calculator (V50) will be available on your aggregator systems from Friday 7 June.
Pipeline applications
For any new home lending submitted after 12:00am on Friday 7 June 2024, please use v50 of the Serviceability Calculator.
Click here for full details on how to treat pipeline applications.
Removal of LMI refunds for loans repaid between 12-24 months
From 10 June 2024, Advantedge and QBE are updating their LMI refund criteria to remove the LMI premium refund for home loans that are repaid between 12 – 24 months.
There is no change to the criteria for home loans repaid within the first 12 months.
| Scenario | Current Refund Criteria | What’s changing from 10 June 2024 |
|---|---|---|
| Home loan is repaid within 12 months of settlement | Eligible customers receive a 40% refund on their LMI premium | No change |
| Home loan is repaid between 12-24 months of settlement | Eligible customers receive a 20% refund on their LMI premium | Customers will no longer receive a refund on their LMI premium |
Pipeline applications
- Customers who take out a new LMI policy, and their loan is drawn down prior to 10 June 2024 will be covered by the existing LMI refund criteria and therefore still eligible for the 20% LMI refund if the loan is repaid between 12-24 months of drawdown.
- Customers who take out a new LMI policy, and their loan is drawn down on or after10 June 2024 will be covered the new LMI refund criteria and therefore only eligible for an LMI refund if the loan is repaid within the first 12 months of drawdown.
Further support
The LMI Fact Sheet will be updated and available on your aggregator systems from 10 June.
If you have any questions, contact your Resi Business Development Manager.
