Supporting documentation and verification guide. For NAB Homeplus and NAB Peak Performance

Transcription

1 Supporting documentation and verification guide For NAB Homeplus and NAB Peak Performance

2 Contents Income verification 2 Full time and part time employment (PAYG)2 2 Casual employment2 2 Return to work income 2 2 Commission, bonuses, overtime 3 Self-employed applications 3 Rental income 3 Shares, dividends, managed investments etc 4 Government allowances (Including family allowances & pensions) 4 Superannuation 4 Child support/maintenance 4 Overseas borrowers/non-residents 4 Assets 5 Genuine savings 5 Non-genuine savings 5 Evidence of funds to complete 5 Purchases 5 Contract of sale 5 First Home Owners Grant (FHOG) if applicable 5 Refinances 5 Full doc loans 5 Construction loans 5 Construction loans 5 Low doc loan 6 Low doc 6 Other verification documents 6 Loan purpose/cash out 6 Genworth 6 Income verification Full time and part time employment (PAYG) One computer generated payslip, not more than one month old as at the application submission date, showing a Year to Date (YTD) figure of at least two pay cycles and both the employer and employee name and ABN (unless the employer is exempt, a government department or listed on the ASX). Or where YTD is not available Two of the last three payslips showing both the employer and employee name and ABN (unless the employer is exempt, a government department or listed on the ASX). The latest payslip must not be more than one month old as at the application submission date. Or Bank statement/s no older than three months, showing the last two salary deposits and the employer s name (Note: Internet Banking transaction listings are not acceptable). Where the salary deposits are inconsistent, and the variance is <20% use the lower salary deposit value and >20% also obtain a payslip to support the bank statement. Note: Bank statements are not required where identifiable credit/s are to NAB accounts. Employee allowances (eg car or clothing) which are fixed/ recurring, verifiable and not discretionary may be included as PAYG income. Where the customer has recently commenced employment or signed an employment contract and payslips are not yet available, obtain either: a letter from the employer detailing the employment arrangement, or the employment contract. Casual employment Casual income can be used when: History of consistent or stable hours and frequency, income is likely to continue, and is consistent with the customers duties or position PAYG Payment Summary or personal tax return for the last financial year is required to support income verification. Return to work income Return to work policy enables the consideration of an applicant s income prior to them physically returning to work, if they: Are returning to work within 60 days from the date the application is submitted, and 2

3 Can provide a letter from the employer (on employer letter head) confirming: Re-commencement date Employment status upon return i.e Full time, Part time or casual and Gross income details Signed by an authorised representative Commission, bonuses, overtime Commission can be considered when: Income is paid as a base salary plus regular commission payments; Commission is of consistent and regular amounts for a minimum of six months; and Verification can be completed Overtime is calculated over the minimum of the most recent 6 months Payslip must include an overtime income or commission YTD Or where the YTD income is not provided or disclosed on the payslip or is less than six months Most recent PAYG Payment Summary; or Most recent Personal tax return; or A signed contract of employment or letter of offer that specifies regular overtime as a condition of employment PAYG Bonus payments should be noted in loan application (along with documentary evidence) to further support the application. Self-employed applications Borrowers can be: Individuals or non-trading entities, Discretionary trusts only (eg family trusts) Acceptable net addbacks: Depreciation Interest and leasing expenses and factor repayments on balance sheet Acceptable gross addbacks: Voluntary superannuation contributions paid by the borrowers (over and above the 9% compulsory contribution). Provide the following: Last two years individual tax returns (for all self-employed borrowers) Last two years business tax returns (Eg partnership/ company/trust) Last two years financials corresponding to the above (ie profit and loss and balance sheet) Last two years individual tax returns for all partners/directors and shareholders/trustees and beneficiaries who are borrowers on the loan Signed & dated copy of Trust deed (If application in the name of the trust) Registered ABN for min 2 years Registered for GST for min 12 months (where applicable) Rental income Deductable interest paid on investment loans is an allowable addback (except for Low doc). The rental income used in the credit assessment will be the lower of: The verified rental income Or 6% of the market value of the property New rental income: An existing property begins to earn an income, Or for a purchase of a new property without a tenant, Or for building a property or purchasing residential property off the plan with intentions to rent the property to tenants A current executed lease agreement, confirming the property owner, address, frequency, amount of rental income A market appraisal from a registered real estate agent on agents letter head, stating property address and be signed (can be digital signature) after signed and dated within 30 days of the loan application A market appraisal contained in a sworn valuation Existing rental income: An existing property already earns an income, Or purchase of new property with an existing lease, A current executed lease agreement A rental statement dated within 60 days of the application submission date showing one month of payments (the statement must be issued on real estate agents letterhead which details the property owner and address. Bank statement/s no older than three months showing at least two direct credits as rental income. Where statements are older than three months, also provide an internet transaction listing. Note: Bank statements are not required where identifiable credit/s are to NAB accounts. In all cases the credit must either display the property address or real estate agent name in the narrative. Note: where it is known there is a private rental agreement in place, rental income must be demonstrated over a minimum of two month period, regardless of frequency of the payments. A rental property schedule contained in a current tax return (must be no more than two years old and either prepared by a tax agent or containing evidence of lodgement to ATO).

4 Shares, dividends, managed investments etc Shares, dividends, managed funds and other income producing assets of this type can only be considered when: The company is publicly listed, The investment is current at the time of the application, A corresponding asset is listed on the credit application One of the following Shareholding certificate or current dividend statement or notice A letter from a NAB Group financial planner A bank statement no older than three months that identifies at least two direct credits as investment income. Where statements are older than three months, also provide an internet transaction listing, Most recent tax return (no more than two years old) Note: Bank statements are not required where identifiable credit/s are to NAB accounts. Government allowances (Including family allowances & pensions) Government allowance, including family allowance and income from pensions can be considered only when the income: Is regular and of consistent amounts Current statement from Centrelink Current bank statement that clearly identifies direct credits as the government allowance. Where statements are older than three months, also provide an internet transaction listing. Note: Bank statements are not required where identifiable credit/s are to NAB accounts. Verification documents must confirm the name of at least one of the customers; that the income has come from the source claimed by the customer; and the frequency and amount of the income. Superannuation Income from superannuation must be verified against one of the following: Current superannuation fund statement Current bank statement showing regular receipt of an allocated pension or income from the superannuation investment a letter from a NAB Group financial planner. Verification documents must confirm the name of at least one of the customers, that the income was derived from the superannuation asset, and the frequency and amount of the income. Child support/maintenance Child support and maintenance payments must be considered according to the type of arrangement held between the customer and the paying party. The type of arrangement will determine if the income is considered reliable and regular enough to be considered in the credit assessment. This type of income must not be input to electronically assessed applications Overseas borrowers/non-residents Lending to a non-resident applicant applies when: the customer is a temporary resident and holds an eligible visa issued by the Department of Immigration Or the customer is a non-resident and holds a Special Category Visa Or Approval from the Foreign Investment Review Board to purchase a property where required Maximum Loan to Value Ratio of 80% Lenders Mortgage Insurance is not available. Provide one of the following primary documents: A copy of the translated documents the visa holder provided to the Immigration Department as part of the visa approval. The most recent personal tax returns, no more than two years old. Document must be translated by an approved method. Plus one of the following secondary documents Copies of two consecutive payslips and a letter from the overseas Employer confirming application income and employment status. Copies of bank statements confirming salary payments. All documents must be in English. Where the documents provided are not in English, they must be translated. Confirmation of citizenship and visa status Brokers must sight the original passport and current visa. Copy of the front page of the passport and visa stamp in borrower s passport Low doc is not available Foreign income will be converted into Australian Dollars (AUD) using NAB exchange rates

5 Assets Genuine savings Evidence of 5% where LVR is above 90% provide one of the following: Equity in the residential property security or any other residential security Funds held in a savings account or term deposit for three months or more Shares held for three months or more as verified by a share certificate or holding statement After-tax bonus payments from an employer Unacceptable forms of genuine savings include: First Home Owners Grant Gifts or inheritances Gambling proceeds Loan funded deposits Advances on wages or commissions Rental discounts Builder or vendor discounts or finance Non-genuine savings Letter from donor confirming any contributions are nonrepayable gifts Evidence of inheritance and when received Evidence of funds to complete The assets we require to verify are those being used as the customer s contribution to the purchase including deposit paid, sale of asset proceeds, cash or funds held in bank accounts Savings being used as funds to complete require verification ie ownership and value of the customers contribution to any purchase (including deposit paid, sale of asset proceeds, cash or funds held in bank accounts) Purchases Contract of sale Copy of contract of sale signed and dated by all parties (exception NSW purchases where contract of sale is signed and dated by purchaser only is acceptable) First Home Owners Grant (FHOG) if applicable FHOG application form Original addendum for additional grant for new properties, and statement/letter from vendor or builder Refinances Full doc loans Last six current months loan statements for loans/s being refinanced, and Last three months credit card/s statements for cards being refinanced showing name, card limit and balance Construction loans Construction loans LVR is calculated based on the lower of valuation or land plus building contract Require Executed Fixed Price Building Contract by a licenced builder Prior to first drawdown Council approved plans Builder All Risk construction and Public Liability Certificate of currency for insurances Builders Insurance of the works (also known as Construction works Insurance) Home Warranty Insurance (Not required for properties in WA) Public Liability Insurance

6 Low doc loans Low doc Applicants must be self-employed or at least one individual must be self employed. Loan limits must not exceed $1 million per loan and $2.5 million aggregated low doc lending Cashout or equity release must not exceed $100,000 for all applications Loan to Value Ratio (LVR) must not exceed 80% Applications must be for an acceptable consumer or personal investment purpose and must not fund investment business purposes. Australian Business Number (ABN) has been registered for two years or more. Customer has been registered for Goods and Services Tax (GST) for 12 months or more. For Low doc customers where LVR is less than 60%, cash out is less than $50,000 and for one of the following purposes, verification is not required: personal investment home improvements or renovations personal use motor vehicle property purchase, including deposits. This does not apply if a cash out has been approved in the past 12 months. Last six consecutive months of statements for all loans including non-nab loans and loans being re-financed (excluding credit cards). Last statement must be no older than three months. Most recent statements for all credit cards. Last three consecutive months of statements for all transaction accounts. Last statement must be no older than three months. Loan purpose: Verification is not required where cash out is less than $50,000 (excluding where a cash out has been approved in the past 12 months) and for one of the following purposes: personal investment home improvements or renovations personal use motor vehicle property purchase, including deposits. Otherwise 80% of the loan purpose is to be verified as above. Other verification documents Loan purpose/cash out Evidence of loan purpose for a minimum of 80% of the total loan amount is required when: LMI is applicable on the loan, Or application has previously been decline or assessed high risk Genworth Loans >$1M will be subject to additional Genworth lending criteria (as required) PAYG payment summary or personal tax return for the last financial year must be provided where employee & employer are related Evidence of 5% genuine savings (over a three month period) where LVR is above 90% If low doc (60 80%) LVR last 12 months Business Activity Statements (BAS) Printed copy of Genworth LMI calculator premium Low doc customers with LVR greater than 60% Self employed income must be verified by obtaining the last 12 months of BAS lodged with the ATO, including evidence of lodgement. Low doc customers with LVR of 60% or less Self employed income must be verified by obtaining one of the following: the last 12 months of Business Activity Statements (BAS) lodged with the ATO, including evidence of lodgement six consecutive months trading account statements (last statement must not be older than three months). accountant s declaration confirming the customer s income. NAB Broker is a division of National Australia Bank Ltd ABN Australian Credit Licence and AFSL A