Increase borrowing capacity

Hi John,

It doesn’t matter whether you purchase under individual or trust when it comes to servicing.

AMP is actually one of the more generous lenders when it comes to servicing however different lenders treat your overseas income different. Westpac and NAB are definitely superior in this space. CBA is quite handy when it comes to LMI loans but since your portfolio is at 80% – you definitely have more options.

Are you an employee in China or Self Employed?

As Colin mentioned AMP has a Max of 10 loans per client, also if your an non resident credit sometimes reduce this number due your exposure to AMP and risk.

Regarding Westpac- They do accept RMB.
In fact most lender that accepts foreign income would accept RMB, as china is the largest foreign investor in Aus.

You have over 11 bask that would accept RMB to choose from, which one will depend on your serviceability with each lender.

jcso99 wrote:

Hi Shahin, I am currently working for a logistic developer in China and the company is listed in Singaporean Exchange. My salary is denominated in RMB. The issue i have with Westpac and other lenders is that they completely disregard my overseas salary cos they don’t take into consideration RMB denominated income, which absolutely kills my serviceability issue. Any thoughts?

Cheers
John

Ok firstly the real issue with AMP is that they are a securitised lender and they do not have their own DUA. Even if your application ticks all the boxes – the underwriter can still turn around and say “nope not lending you any more money”. I seen this happen to quite strong applications.

Not sure who has advised you that westpac do not accept RMB – as they do. I normally deal with HKD, Pound and SGD but know that they do RMB.

Westpac has has short comings as well so you need to really sit down with a broker and establish a long term plan. For example, Westpac do not like it if your rental income is more than 50% of your total income.

Hey Shahin

I thought AMP had a DUA with Genworth up to 90%?

That was the case a year or so ago – you could put up sub 90% deals and most of them would get signed off in house and not referred to LMI.

Has this changed? I hope not :-(

Cheers

Jamie

Their DUA is still $850,000 but thats not full DUA and sooner or later you will have issues when you go into LMI territory which I see quite often with lenders that don’t have full DUA.

Since he has 5 properties already then it will definitely become an issue if he needs to access MI so AMP’s not the best fit for him.

Hi John,

with 2) Each bank sees your setup under a discretionary trust structure as one. So setting up multiple discretionary trust structures and going back to the same bank will not do any good as they see you as the same guarantor on all the investments. The trust structure protects your assets and does not protect the bank. Whether you setup another discretionary trust or not does not matter to the bank. That decision will be yours to make as long as it still suits your investment strategy.

As far as suggesting other lenders, As in the feeds above you have been given plenty of suggestions but whether your situation will fit the policy of any of these lenders will really be determined by how your case is presented to them and the research done. I would recommend talking to a broker as they will be able to do the research for you. But you may end up with a bad broker that could still make mistakes. So be careful when choosing one.

Another reason to use a broker rather then doing this yourself is to protect your credit score with the banks. There are some that would not penalize you for too many enquiries with other lenders but not all of them do. So why limit yourself when you already have a tricky situation. Try and get it right the first time. Hope all this feedback has helped you make your decision. Good luck with your future investments!

jcso99 wrote:

Thanks for the feedback. I have a couple of follow up questions:
1) RMB income – I remember speaking with a mortgage broker in mid-2013 and told them that my income is denominated in RMB and their reply was that no bank will accept RMB salary. Hence, I didn’t bother to explore other lenders cos I thought RMB denominated income is not welcome by Australian lenders. If that’s not the case, I might explore other options

John

Can name around 7-8 lenders off the top of my head that deals and accept RMB
– ANZ, Westpac, St George, AMP, Bankwest, CBA, Citibank, Homeside,…..

But i would not advise you apply to every single bank and hope for the best as this would trash and kill your credit file; even thought the list of banks accept RMB it doesn’t mean they would necessarily like your deal or approve your loan- it will cone down to their credit policy based on your situation and serviceability and overall risk of the deal.

For example, i can probably safely say Westpac would most likely be a no deal for your situation as you have 5 IP and your rentla income may be more than your standard income ( rental reliance policy) + your standard income is a foreign income as well.

Regards

Doesnt anyone else use Macquarie? They can be as flexible as AMP within their DUA policy. I just did one this year for another investor with a hybrid trust setup. He just got his 11th property on portfolio using MACQ. He did not have the other properties with them yet. No foreign income though. I’m meeting up with Macq today and will find out about accepting foreign income, especially CNY. Will keep you posted.