Browse Forums Home Finance 1 May 11, 2011 6:55 pm With my occupation, I earn a base salary of around $78,000 per year. With overtime and allowances (I'm a shift worker) the income rises to about $100,000 a year and is regular. With regards to borrowing power, do banks only allow the base salary or do they take into account overtime as well? Thanks Borrowing power and overtime 3May 11, 2011 8:43 pm If you require mortgage insurance then they normally ask for one year to date payslip or three non- cumulative payslips to confirm income as well as group certificate. Especially if you are in an industry that is renowned for overtime payts or penalty payts. Some things are worth waiting for. Re: Borrowing power and overtime 4May 11, 2011 8:58 pm Depends on the lender. A few will accept 100% overtime, while others don't allow any overtime at all. Don't just give the lender/broker your payslips/group certificate and hope they look at it as an overall figure as the majority of lenders will only take your base income. Land at Chermside At tender stage Re: Borrowing power and overtime 5May 12, 2011 8:51 am The lending policies for overtime income vary significantly between the major banks. Many of them do not accept overtime or accept only 50% of your overtime if you are borrowing over 80%. Others require overtime to be a condition of your employment (e.g. nurses, police, essential services workers) for it to be considered. There are some banks that can just annualise your YTD figure. You can use this YTD calculator to work out how these lenders would assess your overtime income from your payslips and your group certificate. The trick is to present the right info to the lender so that they assess your overtime in the best possible way Serviceability is a complex area of lending. There is more to be taken into account than just your overtime income. Some banks use assessment rates that are much higher than the actual rate you pay, and as a result you can borrow much less even if they take 100% of your overtime into account. This is particularly true for investors as rental income & investment loans are assessed in so many different ways. It isn't uncommon for one lender to think that a customer is overcommitted and another to think that they can afford an additional $500k +!!! For this reason we always do our own assessment and don't rely just on the banks. Getting serviceability wrong either squashes a customers dreams of home ownership or overcommits them, either way it's a bad outcome. Would also like an opinion from anyone that has used xcem over hebel for floors. Thanks 1 14245 2 15470 Our relationship with the owner is good, but I'm not sure if I want to impose putting a pole on their property. Your conversation with your neighbour must have gone well… 4 9328 |