Supporting documentation
and verification guide
Contents
Income verification
Income verification 2 Full time and part time employment (PAYG) Casual employment Return to work income Commission, bonuses, overtime 3 Self-employed applications 3 Rental income 3 Shares, dividends, managed investments etc 4 Government allowances (Including family allowances & pensions) 4 Superannuation 4 Child support/maintenance 4 Overseas borrowers/non-residents 4 Assets 5 Genuine savings 5 Non-genuine savings 5 Evidence of funds to complete 5 Purchases 5 Contract of sale 5 First Home Owners Grant (FHOG) – if applicable 5 Refinances 5 Full doc loans 5 Construction loans 5 Construction loans 5Low doc loan 6
Low doc 6
Other verification documents 6
Loan purpose/cash out 6
Genworth 6
Full time and part time employment
(PAYG)
One of the following: • One computer generated payslip, not more than one month old as at the application submission date, showing a Year to Date (YTD) figure of at least two pay cycles and both the employer and employee name and ABN (unless the employer is exempt, a government department or listed on the ASX). Or – where YTD is not available • Two of the last three payslips showing both the employer and employee name and ABN (unless the employer is exempt, a government department or listed on the ASX). The latest payslip must not be more than one month old as at the application submission date. Or • Bank statement/s no older than three months, showing the last two salary deposits and the employer’s name (Note: Internet Banking transaction listings are not acceptable). Where the salary deposits are inconsistent, and the variance is <0% use the lower salary deposit value and >0% also obtain a payslip to support the bank statement. Note: Bank statements are not required where identifiable credit/s are to NAB accounts. Employee allowances (eg car or clothing) which are fixed/ recurring, verifiable and not discretionary may be included as PAYG income. Where the customer has recently commenced employment or signed an employment contract and payslips are not yet available, obtain either: • a letter from the employer detailing the employment arrangement, or • the employment contract.Casual employment
Casual income can be used when: • History of consistent or stable hours and frequency, income is likely to continue, and is consistent with the customers’ duties or position One of the following: • PAYG Payment Summary or personal tax return for the last financial year is required to support income verification.Return to work income
Return to work policy enables the consideration of an applicant’s income prior to them physically returning to work, if they:
• Can provide a letter from the employer (on employer letter head) confirming: – Re-commencement date – Employment status upon return i.e Full time, Part time or casual and Gross income details – Signed by an authorised representative
Commission, bonuses, overtime
Commission can be considered when: • Income is paid as a base salary plus regular commission payments; • Commission is of consistent and regular amounts for a minimum of six months; and • Verification can be completed Overtime is calculated over the minimum of the most recent 6 months One of the following: • Payslip must include an overtime income or commission YTD Or where the YTD income is not provided or disclosed on the payslip or is less than six months • Most recent PAYG Payment Summary; or • Most recent Personal tax return; or • A signed contract of employment or letter of offer that specifies regular overtime as a condition of employment PAYG Bonus payments should be noted in loan application (along with documentary evidence) to further support the application.
Self-employed applications
Borrowers can be: • Individuals or non-trading entities, • Discretionary trusts only (eg family trusts) Acceptable net addbacks: • Depreciation • Interest and leasing expenses and factor repayments on balance sheet Acceptable gross addbacks: • Voluntary superannuation contributions paid by the borrowers (over and above the 9% compulsory contribution). Provide the following: • Last two years individual tax returns (for all self-employed borrowers) • Last two years business tax returns (Eg partnership/ company/trust) • Last two years financials corresponding to the above (ie profit and loss and balance sheet) • Last two years individual tax returns for all partners/directors • Signed & dated copy of Trust deed (If application in the name of the trust) • Registered ABN for min years • Registered for GST for min 1 months (where applicable)Rental income
Deductable interest paid on investment loans is an allowable addback (except for Low doc). The rental income used in the credit assessment will be the lower of: • The verified rental income Or • 6% of the market value of the propertyNew rental income:
• An existing property begins to earn an income, • Or for a purchase of a new property without a tenant, • Or for building a property or purchasing residential property ‘off the plan’ with intentions to rent the property to tenants One of the following: • A current executed lease agreement, confirming the property owner, address, frequency, amount of rental income • A market appraisal from a registered real estate agent on agents letter head, stating property address and be signed (can be digital signature) after signed and dated within 30 days of the loan application • A market appraisal contained in a sworn valuation
Existing rental income:
Shares, dividends, managed
investments etc
Shares, dividends, managed funds and other income producing assets of this type can only be considered when: • The company is publicly listed, • The investment is current at the time of the application, • A corresponding asset is listed on the credit application One of the following • Shareholding certificate or current dividend statement or notice • A letter from a NAB Group financial planner • A bank statement no older than three months that identifies at least two direct credits as investment income. Where statements are older than three months, also provide an internet transaction listing, • Most recent tax return (no more than two years old) Note: Bank statements are not required where identifiable credit/s are to NAB accounts.Government allowances (Including
family allowances & pensions)
Genuine savings
Evidence of 5% where LVR is above 90% provide one of the following: • Equity in the residential property security or any other residential security • Funds held in a savings account or term deposit for three months or more • Shares held for three months or more as verified by a share certificate or holding statement • After-tax bonus payments from an employer Unacceptable forms of genuine savings include: • First Home Owners Grant • Gifts or inheritances • Gambling proceeds • Loan funded deposits • Advances on wages or commissions • Rental discounts • Builder or vendor discounts or financeNon-genuine savings
• Letter from donor confirming any contributions are non-repayable gifts • Evidence of inheritance and when receivedEvidence of funds to complete
The assets we require to verify are those being used as the customer’s contribution to the purchase including deposit paid, sale of asset proceeds, cash or funds held in bank accounts Savings being used as funds to complete require verification ie ownership and value of the customers contribution to any purchase (including deposit paid, sale of asset proceeds, cash or funds held in bank accounts)
Contract of sale
• Copy of contract of sale – signed and dated by all parties (exception NSW purchases where contract of sale is signed and dated by purchaser only is acceptable)First Home Owners Grant (FHOG)
– if applicable
• FHOG application form
• Original addendum for additional grant for new properties, and statement/letter from vendor or builder
Refinances
Full doc loans
Low doc
Applicants must be self-employed or at least one individual must be self employed. Loan limits must not exceed • $1 million per loan and • $.5 million aggregated low doc lending Cashout or equity release must not exceed $100,000 for all applications Loan to Value Ratio (LVR) must not exceed 80% Applications must be for an acceptable consumer or personal investment purpose and must not fund investment business purposes. Australian Business Number (ABN) has been registered for two years or more. Customer has been registered for Goods and Services Tax (GST) for 1 months or more. For Low doc customers where LVR is less than 60%, ‘cash out’ is less than $50,000 and for one of the following purposes, verification is not required: • personal investment • home improvements or renovations • personal use • motor vehicle • property purchase, including deposits. This does not apply if a ‘cash out’ has been approved in the past 1 months. Last six consecutive months of statements for all loans including non-NAB loans and loans being re-financed (excluding credit cards). Last statement must be no older than three months. Most recent statements for all credit cards. Last three consecutive months of statements for all transaction accounts. Last statement must be no older than three months. Low doc customers with LVR greater than 60% Self employed income must be verified by obtaining the last 1 months of BAS lodged with the ATO, including evidence of lodgement. Low doc customers with LVR of 60% or less Self employed income must be verified by obtaining one of the following: • the last 1 months of Business Activity Statements (BAS) lodged with the ATO, including evidence of lodgement • six consecutive months trading account statements (last statement must not be older than three months). • accountant’s declaration confirming the customer’s income. Loan purpose: Verification is not required where ‘cash out’ is less than $50,000 (excluding where a ‘cash out’ has been approved in the past 1 months) and for one of the following purposes: • personal investment • home improvements or renovations • personal use • motor vehicle • property purchase, including deposits. Otherwise 80% of the loan purpose is to be verified as above.Other verification documents
Loan purpose/cash out
Evidence of loan purpose for a minimum of 80% of the total loan amount is required when: • LMI is applicable on the loan, • Or application has previously been decline or assessed high risk
