The major bank has announced changes to its genuine savings policy for FHBs, as well as extended its tax return validity period.
ANZ has announced changes to its genuine savings policy for first home buyers (FHBs), allowing FHBs to have their records of rental history considered as genuine savings, effective from 23 March 2020.
As it stands, for home loan applications with a loan-to-value ratio of more than 85 per cent, evidence is required of three months’ genuine savings, on top of evidence of funds to complete.
The new ANZ policy will see owner-occupier FHBs allowed to provide history of rental payments as evidence of their ability to consistently save.
Satisfactory evidence of rental payment history can be demonstrated through either:
Further, rental payments must be shown to have been consistently paid on time in order to be applicable to the new policy, with any payments overdue by seven days or more being considered “unacceptable”.
The evidence provided, such as rental statements, must be accurate within 60 days of the home loan application date.
The new genuine savings policy is only applicable for loans in which every borrower is a first home buyer.
Tax return validity period changes
In addition to the FHB genuine savings policy changes, the major bank has announced an amendment on the acceptance of tax returns in relation to home loan applications.
Effective from today (23 March 2020), ANZ will extend the tax return validity period for home loan applications by 7.5 months, extending validity from 31 December to 15 May, resulting in a total validity period of 22.5 months.
Under the previous policy, only 2019 tax returns were required as of 1 January 2019; however, under the new policy, the bank can accept 2018 tax returns and financials for any applications submitted on or prior to 15 May 2020.
This change will align with the ATO’s final cut-off for return lodgement.
According to ANZ, the extension of the validity period is applicable to any income verification that requires a tax return/NOA. This includes when a tax return is required for PAYG income verification, rental income etc.
For self-employed applicants, the required documents to verify income include the borrowers individual tax return as well as:
Hannah Dowling is a journalist for The Adviser and Mortgage Business.
Prior to joining Momentum Media, Hannah worked as a content producer for a podcast catering to property investors. She also spent six years working in the real estate sector at a local agency.
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