Though the bank had not found any instances of money laundering, the risk for such led ANZ to decide not to accept mortgage applications that is 100 per cent foreign-funded. Applications with 50 per cent or higher offshore funding will have no guarantor arrangements, no loans in a company name, restricted construction lending, and a maximum of 70 per cent loan-to-ratio value.
In the past, many applications had missing passport pages, crudely translated supporting documents, and salaries being paid by obscure offshore companies. As a result, application requirements for foreign residents now include a passport with all stamped pages, three months of pay slips, salary credits verified from bank statements, and employment contracts with the employer's phone number and website details.
Loan applications sourcing offshore repayments only make up less than one per cent of ANZ's total loan book, but the bank said that the numbers are increasing rapidly. However, the exact amount of foreign money being used to fund local property remains unclear.
Meanwhile, other lenders like Commonwealth Bank of Australia, National Australia Bank, and Westpac said that they are not banning any group or category when it comes to loan applications, although they admitted that they have specific requirements and tighter risk policies for foreign nationals.
Collections: Mortgage News