Hi. Just curious to know if banks have the authority to get\verify personal information about their clients such as tax details from ATO or Super balance etc in matters like homeloan. Just asking to see if the bank's verifican of tax/super can slow down borrowing process.
Bank Accessing Your Details
oliman on 29/07/2019 - 11:22
Comments
Yes, risk management process 101
They check your bank balance with fine toothed comb looking for stuff you did not declare or add up correctly, plus credit reports from credit agencies etcHave declared everything, it is more about extra time consumed in those verification processes until loan verification. It already take around 40 days for valuation to come back (CommBank, they excused by saying that the valuer was not responsive and they has to use another one.)
There are currently longer timeframes because after APRA removed the 7.25(?) assessment rate, banks have to evaluation each customer individually leading to longer processing for every file and a higher workload in total.
if banks have the authority to get\verify personal information about their clients such as tax details from ATO or Super balance etc in matters like homeloan.
Not only can, but after the Royal Commission, the govt's said basically they have to. Because people can't be trusted to provide correct information/make informed choices themselves.
Hey OP, I recently went through the approval process with a couple of banks to secure a home loan for an investment property.
Ever since the royal commission into the banking, superannuation, and financial services industry, the banks have been obligated by law to be more diligent when ascertaining individual eligibility for a loan.
Unfortunately, as a petty "screw you" to the Government for their sanctions the Banks have decided to tighten the lid down even more than required in order to make it very difficult to obtain a loan; hurting the economy in the process (which makes the Government look bad). I might have just opened a can of worms here that I am not prepared to debate too greatly.To assist with your query, I was required by both banks to hand over historic data on all my bank accounts for proof of savings, proof of living expenditure, etc. I was also required to sign a document stating I would curb my expenditure if I accepted the loan from the bank (which my broker thought was very pedantic as the investment property was positively geared).
As far as Super they did not ask me, but I think it is safe to say they have access to see that information. They did ask for my TFN so assume they have access to this as well. As HighAndDry has stated it might even be required under the new sanctions.
Good luck with your application! It took me about two weeks total with a broker to get approved and have all the paperwork signed and sent back, including the time taken for the more pedantic requirements they asked from me.
Thank you. Greatly appreciate your reply.
Ever since the royal commission into the banking, superannuation, and financial services industry, the banks have been obligated by law to be more diligent when ascertaining individual eligibility for a loan.
Unfortunately, as a petty "screw you" to the Government for their sanctions…I can completely understand the bank's views. The RC basically said "no matter what the customer told you, and no matter that you're using assumed rates which are 90% of the time more conservative than self-reported information, you STILL have to check, yourself, all that information again otherrwise it's exploitative to give people the loans they're asking for."
It's utterly ridiculous and the government (and the wider public, for supporting the RC) deserves all the consequences it caused.
HighAndDry can you clarify for me, please.
Are you agreeing with my statement that the Banks have tightened the lid beyond the requirements imposed by the Royal Commission in order to, for lack of a better phrase, "put the hurt" on the Government through a significant decline in loans?
But you are also saying that this response from the Banks is justified, or more specifically you understand why they have done this, as the Government sanctions are too over the top?
Are you agreeing with my statement that the Banks have tightened the lid beyond the requirements imposed by the Royal Commission in order to, for lack of a better phrase, "put the hurt" on the Government through a significant decline in loans?
Not exactly. The Royal Commission didn't specify clearly that banks need to do just "X, Y, and Z". Their guidelines are (as all government ones tend to be), fairly vague. Banks had ALREADY thought they were following industry best practice as approved by the government, so, to your second point, it's completely understandable they are now being more careful.
Case in point - https://www.abc.net.au/news/2018-11-13/westpac-home-loan-res…
Even a JUDGE thought that ASIC's determination that Westpac had violated responsible lending rules (which Westpac itself also agreed to in the wake of the Royal Commission, likely for PR and cost reasons) was bunk, especially:
Out of 261,987 loans that were approved using the HEM benchmark, 211,937 involved customers declaring expenses that were lower than the HEM…
In these cases, use of the HEM actually reduced the amount of money the customer could borrow compared to what they declared.
For clarification, the bank's basically already disregarded the customer's self-reported information, used a industry standard benchmark (HEM) and yet the Royal Commission and ASIC still judged this to have been irresponsible on part of the bank.
@Godric: Hahahah I like my privacy too much. If it was an AMAAMOOS (Ask Me Anything About My Opinions On Stuff), then sure……… maybe when I have a free weekend or something.
Edit: Funnily enough that sounds a little like (in my very bad French), "A m'amuse" which (again in my very bad French) should mean something like "for fun"…
I had to provide everything that other posters have however I refused to provide my superannuation statements because (a) my LVR was over 70% and (b) the bank nor I could access super to repay the loan anyway. The bank refused the loan as I refused to give them what they deemed necessary financial information. BOQ can go kiss my preverbial. I got a loan with another bank.
Did they asked for tax\payg statements?
Yes and I gave them 3 months worth plus the previous years tax statement.
BOQ can go kiss my preverbial.
Banks just can't win… give people the loans they want, get slapped down for "irresponsible lending". Don't.. and this is what the feedback is. Instead of having it directed at the right party: Government, Royal Commission/Haynes/ASIC, the general public.
The point I was trying to make was that this particular bank was requesting information that they didn't need, maybe as a result of the Royal Commission, I gave them all the necessary information for them to make a decision based on what I had told them and then proven. The bank I eventually got the loan from didn't need my super statements.
The banks were busted for not checking documents they "didn't need" in the Royal Commission. So if some banks want more documents they don't actually need, again - you can blame the RC. Other banks willing to approve with less docs are just more willing to run the risk of being slapped with fines by ASIC.
(b) the bank nor I could access super to repay the loan anyway.
Not true.
Maximum $10K under hardship rules, that's not really going to pay back a mortgage.
Sorry, I should clarify - I wasn't referring to voluntarily accessing. I'm referring to after defaulting on the loan.
The bank can and may be able to access your superannuation or trust assets in certain circumstances. Obviously the bank would like to know everything about OP's super, so to determine if these circumstances may ever arise, prior to giving OP the loan.
ignore comment… (just realised everyone has written what I was writing.)
grabs popcorn