Hi Everyone, I am an Aussie expat living overseas. I currently have a mortgage on an investment property with CBA. I have applied for more finance to invest in additional property however CBA advise that they have concerns re: servicing. They were reluctant to confirm their exact policy on this topic but based on the limited info they did give it seems that they convert my foreign salary into AUD, minus 20% to account for currency fluctuations (i.e. only recognise 80% of my foreign earnings), then apply Australian income tax rates (non resident levels even though I pay very low tax rates in an Asian country) to calculate my net income. CBA advised that this is a relatively new policy (last 1-2 yrs) + refuse to make any exception/adjustment to this handling. Can someone please kindly advise if all Oz banks have similar conservative/restrictive policies in relation to expat foreign salaries???
Hi Ozboy
Yes hate to say you are correct and that CBA are amongst a number of lenders who have recently changed their expat lending policy.
JacM and I do a lot of loans and property acquisitions for expat clients and the you would surprised the varying policy these days.
We have many forum clients who work in Dubai and pay No tax at all so it is a matter of working thru the varying policy to find the most suitable loan.
Of course without all of the facts and figures it is difficult to provide a more structured answer.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
yes same o my case with cba, plus they have 2m cap on the loan, and they use higher fx rates
Yep sure do.
They are certainly not the lender to deal with for Expat lending these days.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi OzBoy74,
My wife and I are here in New York and have a portfolio loan through St George for IP’s in Sydney, I don’t know the exact US$:$A conversion rate they used but they have something similar, they also wont lend more than 70% LVR.
The weird part is that because of the change in currency since last year serviceability didn’t come up as an issue because even after their “calculations” our income had gone up 18% due to the exchange rate change.
Its silly and they should be using something like a 5 year average but basically $A down means you can borrow more. Makes you wonder how often they change it eg week to week…….
Cheers,
Dean
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