AMP Bank lending policy updates: What’s new?

Today (1 July) commenced the changes, with adjustments to self-employed income, rental, and bonus income shading policies, which AMP Bank said will help simplify borrowing.

What exactly will this simplification look like? According to AMP Bank, the changes are as follows:

1. Self-employed income policy

When brokers submit a home loan for a self-employed customer, AMP Bank now only requires:

• An established customer ABN for a minimum of two years.
• One-year tax return (most recent) and notice of assessment for individuals (sole traders, directors, or partners).
• One-year tax return (most recent) for business entities (company, partnership, and trust). 
• If customers meet servicing with the one-year tax return and notice of assessment, AMP Bank won’t require any other financial statements.

2. Bonus shading

AMP Bank’s bonus income shading policy is now uncapped at 20 per cent over one year, meaning 80 per cent of after-tax bonus income will apply to a customer’s income assessment, irrespective of the size of the bonus. The previous policy terms shaded 20 per cent of bonus income up to $50,000, with any bonus income in excess of $50,000 shaded at 50 per cent.

3. Rental shading

Twenty per cent shading on all residential investment properties in all zones (inclusive of high-density apartments), regardless of documentary evidence provided (i.e. lease agreement, rental statement, or third-party estimates).

Thirty-five per cent shading on all non-residential, commercial, or industrial investment or owner-occupied properties (third-party estimates not allowed). Thirty-five per cent shading on serviced apartments and short-term rentals and 20 per cent shading where documentary evidence is a third-party estimate. The previous policy terms shaded rental income at varying rates (ranging from 20–40 per cent based on zones, property types, and verified rental income or third-party estimates.

Commenting on the announcement, AMP Bank’s head of lending and everyday banking distribution Paul Herbert said the changes are in the interests of brokers and borrowers.

“Having listened to our brokers and customers, we are confident the steps we have taken to simplify and streamline our approach to capturing self-employed income, rental income and bonus income calculation will save time, reduce complexity and help more customers to reach their goals,” said Herbert.

“The enhancements are also further demonstration of AMP Bank’s strong commitment to brokers, and follow our recently announced partnerships with Simpology and MSA which are set to transform our loan origination process in the coming months.

“Importantly, the changes firmly align with AMP Bank’s strategy to support Australia’s small-business community which will also see the launch of a new digital bank in early 2025 using Engine by Starling technology.”

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Jack Campbell is the editor of Broker Daily. After graduating from the University of Wollongong in 2022, Jack began his journalistic career working on Broker Daily’s sister brand, HR Leader. In August 2023 he was made the news editor and worked alongside some talented journalists writing articles and recording podcasts.

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