Company car home loan

Can lenders take company cars and car allowances into account?

Banks and other lenders don’t always use common sense when they calculate your income to assess your loan application. Many do not consider a company car to be an income as such, and so just use your cash salary when working out how much you can borrow.

There are some lenders that will take a vehicle allowance or company car benefit into account. Read on to find out how to maximise the amount you can borrow.

How do the banks view these benefits?

Most banks ignore vehicle benefits because they assume any allowances are used to pay for additional travel costs incurred or because a company car itself isn’t a “cash” benefit that can be spent but rather a saving on your normal living expenses.

Our best lender for car allowances / company cars will take 100% of the car or travel allowance you receive into consideration or will add $5,000 to your assessable income when calculating your borrowing capacity. A few lenders can even consider travel allowances and other benefits assuming that they are not reimbursements for costs you have incurred.

How much can I borrow?

With our best lenders you can borrow up to 95% of the property value while including this additional income. Many other lenders are constrained by their Lenders Mortgage Insurer when taking this income into account and as a result cannot lend more than 80% of the property value.

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Here at the Home Loan Experts our mortgage brokers have extensive knowledge of the guidelines used by Australian lenders. Please enquire online to discuss your situation with a mortgage broker.