ANZ has confirmed the bank is reviewing a number of brokers after identifying issues with income documentation for home loans.
In a statement provided to The Adviser, ANZ said it has identified issues with the income documentation of a small percentage of Australian resident borrowers who rely on foreign income.
“Policy changes have been made to address this and we are also reviewing a number of brokers,” an ANZ spokesperson said.
“Of the relatively small number of existing borrowers where we believe there are issues with income documentation, these are generally genuine owner-occupiers who have LVRs less than 80 per cent and the loans are performing better than the portfolio average.
“All our analysis to date indicates the issue is relatively small and there is no material credit risk issue involved.”
ANZ’s statement comes after Fairfax today reported that ANZ and another major bank are “investigating suspected fraud involving declarations by a number of home loan borrowers who rely on foreign income”.
The major bank was the first of the big four to curb mortgage lending to non-residents, announcing late in March that it would no longer accept applications for loans based on 100 per cent foreign income.
CBA and Westpac have since announced similar measures.
ANZ CEO Shayne Elliott told The Adviser last week that the decision was driven by the difficulties in doing income verification checks for non-residents.
“It is quite complicated verifying somebody’s income when you’re looking at foreign language documents and in jurisdictions that don’t necessarily have the same paperwork and backups that we do here,” Mr Elliott said.
He added that there had been increasing uncertainty across the industry around “the validity of some of those documents”.
James Mitchell has over eight years’ experience as a financial reporter and is the editor of Wealth and Wellness at Momentum Media.
He has a sound pedigree to cover the business of mortgages and the converging financial services sector having reported for leading finance titles InvestorDaily, InvestorWeekly, Accountants Daily, ifa, Mortgage Business, Residential Property Manager, Real Estate Business, SMSF Adviser, Smart Property Investment, and The Adviser.
He has also been published in The Daily Telegraph and contributed online to FST Media and Mergermarket, part of the Financial Times Group.
James holds a BA (Hons) in English Literature and an MA in Journalism.
Brokers are driving competition in the mortgages sector and chang...
An SME lender has raised $25 million in equity to fund the ‘rap...
The weekly round-up of the biggest news stories from across Momen...