The future of specialised lenders is in question with the advent of NCCP requirements, it has been claimed.

With ASIC monitoring the NCCP responsible lending requirements, industry sources have questioned the viability of lenders which specialise in low-doc and non-conforming lending. In its latest release to brokers, aggregator nMB claimed ASIC's monitoring would be casting particular scrutiny on the non-conforming space.

"ASIC seems to have a very strong focus on the level of no-doc/low-doc lending pre- and post- the introduction of the new responsible lending provisions," nMB managing director Gerald Foley said.

With this intensified scrutiny of non-conforming loans, Mortgage Choice compliance and corporate standards manager Tim Donahoo has commented that lenders specialising in the non-conforming space may find themselves in the crosshairs as responsible lending practices are enforced.

"The whole non-conforming environment is an interesting one, because they're more vulnerable to any questioning of policies. By definition, their demographic is people who might be regarded as on the fringe of being creditworthy," he remarked.

Some specialist lenders, such as Pepper Home Loans, have stated that the non-conforming environment has changed as banks have tightened lending criteria. Pepper CEO Patrick Tuttle told Australian BrokerNews in May, following the company's acquisition of GE Capital's $5bn loan book, that the lender would focus on writing business which would have been considered prime prior to the GFC. However, Donahoo questioned if this would provide sufficient volume to see many specialist non-conforming lenders succeed.

"Whether they can generate sufficient business to stay afloat is a question. The fact is they simply can't offer credit now to a certain category of people they used to," he commented.