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Banks that treat overseas income, including from shares, favorably?

Discussion in 'Property Finance' started by Fortune Favors the Bold, 21st Apr, 2016.

  1. Fortune Favors the Bold

    Fortune Favors the Bold Well-Known Member

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    Hi folks,

    I am in the process of buying a house in Melbourne together with my partner, with her as owner and me as servicing guarantor. She is an Australian citizen and I am a US citizen on a partner visa, which is pending permanency. Both of us are living overseas in, where I work for a foreign organization and she works for the Australian government. I get paid in USD, while she gets paid in AUD. I have also have a substantial shares portfolio in the USA, and we had planned to use earned dividends to help service our loan. Today I made an inquiry with CBA and received a letter as follows:

    ****
    In your circumstances, unfortunately due to recent regulatory and bank changes, there have been recent lending restrictions applied on non-residents, as well as using foreign income (US Share Dividends).

    For applications where a non-resident is involved, it does mean the maximum loan to value ratio the bank can lend is 70%, down from the previous 80% allowable.

    Also we are not able to accept foreign income for specified temporary residents of Australia (ie if you were to earn an income in any currency other than AUD, given you’re not a PR yet).

    Another restriction is we’re not able to use dividends received from a share portfolio that is not held within Australia. Previously it could be considered on a case by case basis for very strong applications, however they have now advised it’s not eligible income for servicing use, in any circumstance.

    Unfortunately what this means is it would need to pass our servicing requirements solely based on your partner's income if that’s being earned in AUD.

    *****

    This is extremely unfortunate for us, and appears like it will disrupt our plans in a big way.

    Are all banks operating in this way now, or are some more favorable towards foreign income, including from foreign shares?

    Thanks in advance for your help.
     
  2. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    There is a general slow down, however id say there are still opportunities there for an 80 % lend


    ta
    rolf
     
  3. Fortune Favors the Bold

    Fortune Favors the Bold Well-Known Member

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    Thanks Rolf. Are you aware of any banks that would particularly amenable?

    The thing we're most concerned about is whether they'll favorably consider my US shares and foreign non-AUD income. If they don't then we're going to be knocked back in a big, big way.
     
  4. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    just doing a 90 % with offshore income.............

    but depends on what currency is eared and a few other things

    Plenty good brokers in Melbourne that post here that can cut through the issues and get you a great outcome


    ta
    rolf
     
  5. Fortune Favors the Bold

    Fortune Favors the Bold Well-Known Member

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    Thanks again Rolf.

    Just to clarify, what exactly do you mean by "doing a 90% with offshore income"?

    Foreign earned currency will likely be USD and GBP.

    Any specific suggestions on brokers? Anyone interested in lending a hand?
     
  6. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    Up to 90 % lend may be achievable

    Im sure someone will be along to put their hand up soon : )

    ta
    rolf
     
  7. Fortune Favors the Bold

    Fortune Favors the Bold Well-Known Member

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    Right. I wonder why CBA is being so prickly? Off the top of your head do you know which banks might be more willing to play ball?
     
  8. Steven Ryan

    Steven Ryan Mortgage Broker Business Plus Member

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    Macquarie may be able to help take 90% of the share dividends if consistent and evidenced with previous 2 years’ Australian tax returns, if it's not the sole source or majority of income required to meet loan serviceability.
     
  9. Mitesh Dedhia

    Mitesh Dedhia Well-Known Member Business Member

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    Upto 90% lend is possibly. I've been able to help 457 visa holders recently with overseas income a loan.
     
  10. Fortune Favors the Bold

    Fortune Favors the Bold Well-Known Member

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    Thanks guys. This forum and the people in it are invaluable, truly.

    As professional finance brokers, how quickly are you usually able to get loans approved and ready for settlement once a purchase has been made?
     
  11. Paul@PFI

    Paul@PFI Tax Accounting + SMSF Business Member

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    The bank is saying they think you may depart and its too hard to prove income / assets.
    Use a good broker and dont approach a bank direct.
     
  12. Skilled_Migrant

    Skilled_Migrant Well-Known Member

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  13. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    from 10 days to 4 weeks depending on lenders is about the spectrum at the moment
    ta
    rolf
     
  14. Fortune Favors the Bold

    Fortune Favors the Bold Well-Known Member

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    So I've done some investigation today and it seems like many of the banks are now either negative towards foreign income or reject it completely in their assessment. I spoke with NAB and CBA in particular, and both said that they flat out will not consider income from my US shares account (they will only consider ASX listed shares held in an Australian account).

    One ray of light appears to be Bankwest, which seems very happy to consider foreign income as well as shares. Can anyone else confirm this from their experience?
     
  15. Yson

    Yson Well-Known Member

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    U try ANZ?
     
  16. Fortune Favors the Bold

    Fortune Favors the Bold Well-Known Member

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    I haven't tried ANZ yet. Can anyone here confirm that they would still accept income produced by a US shares portfolio (US companies, in a US account, in US dollars)?
     
  17. sash

    sash Well-Known Member

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    Try HSBC........or Citibank...they are used to dealing with overseas investors in Australia.
     
  18. Fortune Favors the Bold

    Fortune Favors the Bold Well-Known Member

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    Just spoke with Bankwest and they've changed their tune - not willing to entertain income from overseas shares. Trying to get through to HSBC, Citibank, Westpac, and NAB. This is getting pretty stressful.
     
  19. Fortune Favors the Bold

    Fortune Favors the Bold Well-Known Member

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    Spoke with Westpac and they're no longer willing to consider overseas dividend income either.
     
  20. Fortune Favors the Bold

    Fortune Favors the Bold Well-Known Member

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    ANZ says they might consider, but can't commit