Disaster Payment Affecting Home Loan Application

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  Unorthodox on 28/08/2021 - 20:24

  How much is the gap between the distaster payment and the usual post-tax amount that would hit her account?

  What is her occupation? To what degree is it affected by the lockdowns? Is it retail vs hospitality vs fitness industry vs a library etc

  There are multitudes of factors that should be explainable or communicated so the assessment is done properly.

  1) People overestimate the impact of credit checks for mortgage pre-approval limit assessments. It's very common for you to have to get the amount reassessed if you do not purchase within the set time limit (~ 6 months). People have changes in circumstances where they go back to the bank assessing to get another reassessment.

  2) Your broker needs to be raising these issues with you pre-emptively so you can address with comments. When they utilise their lending panel they should be knowledgeable on areas of concern flag indicators and be able to respond to common queries.

  Given they've dropped the ball, you need to get them to communicate with the lender they approached to respond to the query.

  Or alternatively go to a lender directly and have it explained to them directly when they send off the assessment. Sometimes brokers just aren't on top of things, they can often not be up to date on a particular lender's response to things like HECs, BNPL, entertainment expenses, company reimbursable expenses, salary sacrifice etc

  • 

    urbancartel on 28/08/2021 - 20:36

    Thanks for the detailed reply :)

    The gap was around $200 for the full week (normal after tax is around $938 and the disaster payment was $750) - She's Hospitality sector (Full Time manager)

    Good to know i've perhaps overestimated the impact on my credit score - was thinking maybe we shouldn't reapply for another 6 months (we're finding it really difficult to find something in our price range as it is, who knows where it will be in 6 months time)

    I was really surprised to be honest that she didn't pick it up pre putting in our application - she was pretty confident we would have no problems. This seems like it never had a chance and should have advised that way.

    It was even with their own product - Aussie Select Home Loan

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  Neoika on 28/08/2021 - 20:32

  +1

  No one else mentioned disaster payment in the recent high cashback refinance deal. From what I know, payment from Centrelink is an ineligible income source for home loan application.

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  JimmyF on 28/08/2021 - 20:55

  i'm pretty annoyed that we're potentially going to keep having this problem in the foreseable future (we're going to need 3 months without a snap lockdown) to be able to submit financials that are not going to raise a red flag.

  and that is why it is raised as a 'red' flag. This income could disappear at any moment, if the gov changes its disaster payment rules etc.

  The same thing was happening in 2020 for people getting jobkeeper at the time.

  Any advice on what we should do?

  Not really, it is what it is now. You have taken the payments, so you can't undo that.

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  [Deactivated] on 29/08/2021 - 07:15

  Move to Qld

  • 

    urbancartel on 29/08/2021 - 09:17

    +1

    Ha! Yeah if only… we we're in Noosa this time last year… should have stayed there :)

    • 

      [Deactivated] on 29/08/2021 - 11:31

      wow

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  Quantumcat on 29/08/2021 - 08:52

  Get your broker to try ME bank. I know a couple where one was on disability pension and ME bank was the only one that counted Centrelink money as income.

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  mortgagebroker on 29/08/2021 - 13:49

  Ask more questions.

  I would be surprised if you receiving the Disaster Payment for 2 weeks was the only reason this was declined.
  I'm sure there would be more to this.

  Was it tight on servicing as is?

  • 

    urbancartel on 29/08/2021 - 15:53

    Nah we spoke again at length with the broker today and that's the only reason that the assessor has given her - said our application was strong and we would have no problems servicing it.

    Being in lockdown again at present and my partners work again closing would also have some bearing although the financials wouldn't have shown that as her last payslip was a full week.

    The problem just seems to be that the lenders won't look at applications with borrowers that have received a disaster payment - something really that our broker should have been aware of.

    Broker was nearly in tears on the phone and very apologetic and basically admitted with their current workload they stuffed up and should've looked closer at our financials and consequences of lockdowns/disaster payments.

    • 

      mortgagebroker on 29/08/2021 - 16:42

      The problem just seems to be that the lenders won't look at applications with borrowers that have received a disaster payment - something really that our broker should have been aware of.

      This is not the case. Most will not use that income.

      If you are not working at the time of application, then they may decline the deal.

      If they work off annualising your last 3 months you may not service as you've has 2+ weeks off.

      I don't know why a broker would be in tears. I understand giving you poor service and being apologetic as they have stuffed up but if it's a strong of a deal as you say it is then they would have had multiple options and suggested going to another lender.

      In the compliance documents they had you sign, what were the other recommendations they gave?

      • 

        urbancartel on 29/08/2021 - 16:58

        We're aware now that lenders won't use that income, but out broker clearly wasn't aware that receiving a disaster payment would be an issue - they we're in constant contact with us in the lead up to the application (it was 1.5 weeks off, not 2+)

        It's true we're back in lockdown again now but this latest lockdown wasn't a part of our financials that were submitted. My income isn't affected by either lockdown either.

        They have suggested trying another lender which they are going to get advice tomorrow from their Manager and also said they would check details thrice and get another broker to look over application before submitting - I think they genuinely felt for us as they had been extremely confident that there would be no issues and failed on a pretty important point.

        Do you mean other recommendations for lenders?

        Also thanks for the time to respond :)

        • 

          CheapskateQueen on 29/08/2021 - 22:50

          @urbancartel: this all seems very extreme. like preposterous level of extreme.

          have you spoken to the bank directly?

          • 

            urbancartel on 30/08/2021 - 00:29

            @CheapskateQueen: No we haven't at this stage - just gone direct with Aussie. I think we'll wait and see what recommendations they come up with once speaking to their manager and go from there…

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  morse on 29/08/2021 - 14:32

  See about applying for mortgages directly with the banks. I went and met with a few when I got my home loan and got them to compete with each other for the best deal (interest rate, offset, fees etc). I found this much better than the one broker we tried. I sometimes wonder if the brokers come back and say one rejected you to make you accept a poorer deal from another that gives them better commission. Not sure if this is a thing, but the broker we saw couldn’t get me anything better than me approaching the banks directly.

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  Jjj888 on 29/08/2021 - 16:09

  Definitely try other banks etc