overtime, bonus,commission payments post APRA

Guys..hope you can assist

How lenders now assess overtime ,bonus and commission payments?

Do we have to provide all the payslips where shows overtime,bonus etc.?

how much it can increase serviceability?

 

It depends on the lender and LVR. At 80% you will have more flexibility. Few lenders such as NAB, CBA, Firstmac, etc will take 100% of the YTD income. Other lenders like Westpac and St George will only take 80% of the YTD income.

There are other lenders like Bankwest, ING and Citibank that will take 100% bonus but the issue is that the rest of their calculator is vomit like.

 

Found just about everytime CBA will only take 80% of commission and bonus.

 

Same here for CBA.

100% of base + 80% of any/all OT.

 

100% of allowances - and clarified with credit what defines Overtime and the response was pretty much unless it specifically says 'overtime' then it can be allowances (obviously commission and bonus not included). So for things like penalty rates, shift work etc can be considered allowances and taken @ 100%

 

NAB no longer takes 100%, anything that's not base is assessed at 80% now.

 

NAB and CBA have only been using 80% of overtime, bonus and commission for several months now. If you simply take the YTD figure you'll run into trouble.

In fact almost every mainstream lender is only using 80% of these. We've found in some cases their calculators and documentation doesn't reflect the policy but it's there anyway. We've had to manually adjust it in a few cases.

Pepper still take 100% of almost anything.

 

I was thinking of allowances - a couple of lenders like ING, Bankwest, etc still do 100% of bonus income but their servicing is tight but at 80% Firstmac is the pick of the lenders.

 

Firstmac accept it at 100% and so to do Homeloans Ltd, most take 80%.

How much can it increase income? Well it'll largely depend on the amount the bonus/overtime/etc is, but for most lenders it will be 80% of that mark given above. For those that take 100% of it, a 10k bonus will increase capacity by around $75k for that transaction, for others its around 50-60k.

In terms of evidencing it, it varies depending on what it is (allowance vs overtime vs bonus). For a bonus - its usually 2 years history. Overtime - varies by lender, but generally worked of the YTD is taken.