Year to Date Income

Just wondering if anyone knows which banks are currently calculating borrowing capacity using year to date income? With credit continuing to tighten, a number of banks are severely discounting any bonus earnings in their calculations of borrowing capacity which can make a significant difference.
 
Just wondering if anyone knows which banks are currently calculating borrowing capacity using year to date income? With credit continuing to tighten, a number of banks are severely discounting any bonus earnings in their calculations of borrowing capacity which can make a significant difference.

Hi Jingo

Depends mainly on the LVR and the lender involved.

AMP are a bit fussy if ur YTD doesnt match, most others are ok if u can show 2 years ( ie PAYG suimmaries) etc

In general Id say not an issue for most clients, and usually only at the margins

ta
rolf
 
Hi Jingo

Depends mainly on the LVR and the lender involved.

AMP are a bit fussy if ur YTD doesnt match, most others are ok if u can show 2 years ( ie PAYG suimmaries) etc

In general Id say not an issue for most clients, and usually only at the margins

ta
rolf

Thanks Rolf,

That is helpful.

Regards Jason.
 
My last loan was with Westpac.

They just took the YTD income.

This included a pretty decent bonus from a very busy June (earned in previous FY but paid in the next one) and July.

This showed an annualised income well above my base salary.

My actual taxable base income is pretty low due to packaging and the way valuers are paid - bonus paid on a % of fee write - in the fortnight pay where there is no bonus I only pay $422 in tax. Great for tax saving but lousy for borrowing capacity.

I was quite pleased about this as I was expecting a bit of a battle over income.
 
Many lenders will ignore bonus income unless receipt can be proven for an extended period of time - often up to 2 years. Some lenders also require it to be paid on a regular basis, such as quarterly. Their rational being that in tough economic times, it's very easy for an employer not to pay an annual bonus.

An annual bonus or even half yearly bonus is not something I like to rely on for affordability.
 
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