super withdrawal

Discussion in 'Loans & Mortgage Brokers' started by Nath, 23rd Sep, 2020.

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  1. Nath

    Nath Member

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    Hello all, word is that people who have withdrawn their early access super through the covid period at some point are not eligible for loans at the moment due to this fact?

    Anyone got some experience or insights into it at all?
     
  2. Lindsay_W

    Lindsay_W Well-Known Member

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    Yeah, it's not 100% true, people who have withdrawn Super can still get a loan, as long as the Super money isn't required for the application.
    Also depends how long ago they took it out.
     
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  3. Jess Peletier

    Jess Peletier Mortgages, Finance & Property Strategy Aust Wide Business Member

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    They have to have been eligible at the time, and things have to have returned to normal for them.

    I have a high income earner who's income dropped but legitimately qualified to take money from super - we've got an application going in for him and are not anticipating any issues.

    On the other hand, we had clients who applied to take it out 'just because' and we couldn't help them unless they cancelled their application.
     
  4. Nath

    Nath Member

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    So its more about the individuals circumstances then and about the security of their income at the time of applying for the loan and less about pulling the super out 6 months ago because of reduced work.
    Thanks for the insight
     
  5. Jerms

    Jerms Member

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    My wife just did this. 10k for both financial years. My wife drew down on her super, she is not working (stay at home parent) and I'm in secure government employment (86k pa). We payed out a personal loan. Redrew equity from 2 IP's and purchased our 3rd borrowed over 100% with some cash down to cover stamp duty refinance break costs etc, bringing overall LVR to 80%.
    We went through a broker and were going to refinance with another lender, but in the end they processed the loans with the same lender.Four loans, three fixed at 2.59 and one variable at 3.03% (this one we will eventually move into).
    There were no questions asked about super and it all just went through.
     
  6. Paul@PFI

    [email protected] Tax Accounting + SMSF Business Plus Member

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    A person who is working at home isnt eligible for super release as they are neither unemployed, eligible for jobseeker or suffering reduced work hours and all are factors that the ATO can easily review and seek enquiry on later. Lenders are right to make further checks as the potential penalties or the tax imposed on the release could alter impact a capacity to repay a loan which is their chief concern as well as maintaining income for those who were imapcted financially to drive them to make the release
     
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  7. Jerms

    Jerms Member

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    Receiving family tax benefits was one of the criteria, which means she met the criteria.
     
  8. Jerms

    Jerms Member

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    It is floored in how they rolled it out and implement the scheme
    .
     
  9. Lindsay_W

    Lindsay_W Well-Known Member

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    Anyone could just say they had a reduction in hours and get it out, there were no additional checks in place before the super was released, leading many who didn't qualify to take it out anyway. Just because you can, doesn't mean you should though.
     
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  10. Lindsay_W

    Lindsay_W Well-Known Member

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    Likely no q's asked as the super money wasn't being used towards the purchase deal, rather to extinguish some existing personal debt.
     
  11. gach2

    gach2 Well-Known Member

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    Out of curiosity how would banks know if Super is released unless it went to one of their accounts, or an account that they request (salary account etc)
     
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  12. beachgurl

    beachgurl Well-Known Member

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    A lot of people are having it deposited into their transaction account. For those lenders who require transaction statements, they can see it's been done.
     
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