AMP Bank today announces changes to its self-employed income, rental and bonus income shading policies, simplifying the borrowing experience for business owners and better reflecting the total income of customers to unlock borrowing options.
The changes include a simplified and reduced documentation requirement for business owners prior to loan approval, together with an increase to the value of a customer’s bonus and rental incomes that can be used for their loan assessment.
Paul Herbert, AMP Bank’s Head of Lending and Everyday Banking Distribution said:
"Having listened to our brokers and customers, we are confident the steps we have taken to simplify and streamline our approach to capturing self-employed income, rental income and bonus income calculation will save time, reduce complexity and help more customers to reach their goals.
“The enhancements are also further demonstration of AMP Bank’s strong commitment to brokers, and follow our recently announced partnerships with Simpology and MSA which are set to transform our loan origination process in the coming months.
“AMP Bank believes brokers are vitally important to a highly competitive lending market and in helping Australians achieve the best possible loan outcomes.”
“Importantly, the changes firmly align with AMP Bank’s strategy to support Australia’s small-business community which will also see the launch of a new digital bank in early 2025 using Engine by Starling technology.
All changes announced today will take effect from 1 July 2024 and follow careful consideration of risk for both customers and AMP Bank.
The changes include:
Self-employed income policy
When brokers submit a home loan for a self-employed customer, AMP Bank now only requires:
- An established customer ABN for a minimum of two years
- One-year tax return (most recent) and Notice of Assessment for individuals (sole traders, directors or partners)
- One-year tax return (most recent) for business entities (company, partnership & trust)
If customers meet servicing with the 1-year tax return and Notice of Assessment, AMP Bank won’t require any other financial statements.
Bonus shading
AMP Bank’s bonus income shading policy is now uncapped at 20% over one year, meaning 80% of after-tax bonus income will apply to a customer’s income assessment, irrespective of the size of the bonus.
The previous policy terms shaded 20% of bonus income up to $50,000, with any bonus income in excess of $50,000 shaded at 50%.
Rental shading
- 20% shading on all residential investment properties in all zones (inclusive of high-density apartments), regardless of documentary evidence provided (i.e. Lease agreement, rental statement, or 3rd party estimates)
- 35% shading on all non-residential, commercial or industrial investment or owner-occupied properties (3rd party estimates not allowed)
- 35% shading on Serviced Apartments and Short-Term rentals, and 20% shading where documentary evidence is a 3rd party estimate
The previous policy terms shaded rental income at varying rates (ranging from 20-40% based on zones, property types and in based on verified rental income or 3rd party estimates.
More information about AMP Bank’s lending policies is available here.
The product issuer and credit provider is AMP Bank Limited ABN 15 081 596 009, AFSL and Australian credit licence 234517
