Advisers say the big four bank has slashed its test servicing rate from roughly 7% to about 6.45% for all borrowers, even if they have a deposit of less than 20%.
The bank has also adjusted its living costs calculator, making certain costs slightly more expensive, brokers told TMM Online.
One adviser said the changes have made it easier for borrowers overall, giving clients a net gain in servicing of about $400-$500 a month, or about $60,000 per $1,000,000.
"The key thing is that people can now borrow more. It's a good sign after the bank were so cautious coming out of the Covid lockdown."
Mortgages Online's Hamish Patel said the ASB changes "should make a material difference [and] help them frame a clearer picture in regards to the lower rate environment". He added: "It could be interesting to see if other banks follow suit. My personal feeling is lending is about to ramp up if other banks start being as confident as ASB."
The bank's servicing changes come after it slashed home loan rates for high LVR borrowers last week. The lender has moved from charging high LVR borrowers and investors a higher level of interest.
ASB now has a single fixed home loan rate card, but will continue to charge a low equity margin, adding costs for first home buyers.