Proving Your Foreign Income

Proving Your Foreign Income

One of the biggest requirements when buying real estate in Australia is proving your foreign income. Unless you are paying for the property in cash, chances are you would need to apply for a loan in either a bank or other financial institution which would require you to prove that you are capable of paying off your mortgage.

 

Best Practices to Proving Your Foreign Income

Proving your foreign income can be as simple as presenting your financial documents, or as difficult as obtaining certifications and letters from accountants. For your loan application to be easily accepted though, the following are the best practices.

  1. Documents must be in English.

Not all banks and lenders accept non-English financial statements, which can make them reject your loan application outright. It would be best to have an English version handy. If you really can’t provide documents in English (for example, when your local bank only releases documents in your language), then you would need to have them translated. The translated documents must include an interpreter’s certificate as well. This gives the financial institution the assurance that the translation is correct and authentic. There are several qualified and approved translators in Australia for such needs.

  1. Prepare various financial statements.

Documents that can be considered proof of income are pay slips, bank statements and even investment portfolio. Generally, citizens from First World countries can just submit their pay slips. But if you are not from one, it would be best to be prepared with other proof of financial capacity.

Proving Your Foreign Income

  1. Self-employed applicants should prepare an accountant’s letter or auditor opinion.

An accountant’s verification letter is an unbiased assessment of a person’s financial capabilities. It details how financially stable one is and backs up how accurate the information the person of interest has provided. In short, it serves like a certificate of good moral character, in the aspect of your finances.

  1. Prepare tax-returns.

A tax return is a good way to assess your paying capacity. Most banks will ask for certified copies of tax returns, especially for self-employed and business owners.

  1. Prepare additional documents such as:

    1. Certificate of Employment;
    2. Employment Contract;
    3. At least two months’ worth of pay slips;
    4. Three to six months of bank statements indicating the regular deposit of salary in your bank account;
    5. Tax returns from the previous fiscal year.

If you have a partner who is an Australian citizen or a permanent resident, his or her income can also be considered when getting a loan. If not, then don’t count on it. Australian lenders would only accept your partner’s income under strong and special circumstances.

Keep in mind that different financial institutions have different regulations. It would be best to work with a Specialised Mortgage Broker when applying for a loan so that you can be guided not only with the best banks to work with, but also with the necessary documents to submit. Some banks don’t accept mortgage loans from foreigners from certain countries due to various reasons such as tax concerns and trade embargo. Working with a broker will ease the problem of finding the right bank who will work with you at an interest rate you can afford.

If you are confused about where to start, contact us and we’ll help you with your Foreign Real Estate purchase in Australia.