- The ANZ Bank is introducing tougher income and expenses checks on home loan applicants this month.
- Applicants will need pay slips and bank statements to prove income.
- And mortgage brokers are being urged to check the expenses of applicants.
The ANZ Bank is introducing tougher checks on home loan applications.
The bank will want more detailed living expenses, additional checks to verify income, and comprehensive credit reporting.
The tightening of rules is seen as part of a general tightening of standards as banks apply a more rigorous definition of Responsible Lending following the financial services royal commission interim report
As well as pay slips, ANZ Bank applicants will from November 20 need to show three months of bank statements showing salary credits.
And for those in causal or contract jobs, proof six months of continuous employment is required along with six months of bank statements showing salary being paid in.
The new rules are shown in an email to mortgage brokers.
The bank tells brokers, as first reported by The Australian newspaper, of updates to verification policy for income and expenses.
“These changes will apply to all home and investment loan applications,” the bank says in an email.
For investment loans, the bank will also require three months of bank statements showing rental payments being made.
“You are required to make adequate inquiries with customers about their financial situation, and provide additional commentary to explain any material differences between verification documents (for example, bank statements) and customer stated income or expense figures in the Statement of Position, as well as any potential indicators of financial hardship,” the bank says.
“Indicators of financial hardship may include adverse account conduct (e.g. overdrawn, excess, late payments, arrears), regular overdrawing of an account due to gambling transactions, and pay day lender transactions.”