We’re experts in helping self employed borrowers.
A Low doc home loan is a mortgage that borrowers can take out with less documentation than what is required for a standard home loan.
If you’re self-employed, freelancer, casually employed, contract worker, or someone who doesn’t tick the usual loan application boxes, a low doc loan option will help you buy your dream home.
Also referred to as alt doc home loans by a few lenders, it is the only way to borrow with less or alternative paperwork and financial documentation.
Competitive rates are available. Please contact us to learn more.
Major lenders and non-bank lenders are available. Contact us to learn more.
Low doc loans are a higher risk to financial institutions, so they tend to place more significant restrictions on this type of loan.
There are very few lenders that offer low doc solutions, while others have significantly increased the interest rates they are applying.
We’ve outlined a list of potential issues to look out for:
Speak to one of our specialist mortgage brokers by calling 1800 771 900 or enquiring online.
Getting approval for your loan isn’t as easy as it used to be.
We use the following three-step process to help you to find a lender:
Did you know that if you provide partial proof of your income (e.g. an old tax return) that some lenders are now required to ask you for full financial statements and tax returns for all entities?
Pro-tip: A lender cannot ignore a document he sees when completing their assessment. To avoid this issue, only provide the documents requested by the lender, nothing more!
Some low doc lenders are better than the others when it comes to your low doc applications.
Our experienced mortgage brokers can help you be sure of which low doc lender to go with. Please call us on 1800 771 900 to speak with one of our experts.
For modern day low doc loans, you must provide supporting documents to verify the income that you have declared to the lender.
Each lender has their own requirements and will accept different document types to prove your income.
The main documents that can be used to verify your income are:
Under the National Consumer Credit Protection Act (NCCP) Act, lenders require you to provide income verification before approving your mortgage.
If you can’t provide one of these documents then it is unlikely that you can get approval for a low doc loan. However, you may qualify for a no doc loan.
Please call us on 1800 771 900 or enquire online for more information.
Most lenders require you to have an ABN that has been GST registered for two years but this varies between lenders.
One of our lenders will accept someone who has had an ABN for just one day. This is usually for start-up businesses.
Does the declared income make sense? For example, an 18-year-old apprentice would be declined if they declared an income of $200,000.
The banks are still required to meet responsible lending legislation so they will take a common sense approach to your declared occupation and income.
Borrowers should have a good asset to income ratio. One of our lenders likes to see that you have a net asset position that is equal to two times your annual gross income.
For example, if you earn $100,000 a year, you would be expected to have around $200,000 in net assets.
This is a stringent policy for younger applicants and is a little lenient for older borrowers.
For this reason, we usually help young people to apply with a lender that does not have this policy.
Lenders prefer prime security properties in high demand locations like capital cities or regional centres. Many lenders do not accept properties that are unique, in disrepair or difficult to sell.
You can refer to our list of low doc property types for more information.
Most lenders prefer low doc borrowers with total debts under $1 million.
A few select lenders allow loans of up to $2.5m per borrower group (e.g. a husband and wife’s total borrowings together).
On a case by case basis, we can help investors borrow more than $2.5m with some of our lenders but they would need to have significant assets and borrow a low percentage of the property value.
Lenders normally require proof of how the loan funds will be used if any money is released directly to the borrower.
Lenders are concerned that the borrower may not actually have an income and is using the money to make the repayments or that equity is being released to be used as a deposit to buy further properties.
Some lenders will not refinance an existing low document home loan or existing investment loan but will allow you to purchase a property with a low doc loan.
Refinances are known to be a higher risk than loans used to purchase a property.
Unfortunately, many people are caught out by this if they buy vacant land and then later refinance when they decide to build.
Yes, they are. Only difference is that the lending criterias have become stricter throughout the years.
Certain types of low doc loans are much more challenging to obtain than others including loans to refinance existing mortgages or home loans without BAS statements to back up declared income.
You can get almost all of the standard home loan features with your low doc loan:
The following are generally not available with a low doc mortgage:
In most cases, you would need to lodge a new application so that the lender’s credit department could review your situation when a repayment break or new security property was required.
Low doc home loans are designed to assist those who have a deposit saved or have existing equity in a property but are self employed and have difficulty proving their income.
Low documentation lows could benefit the following:
To see if you will qualify with a lender for a low doc loan, try out our low doc home loan calculator, submit an online enquiry or call us on 1800 771 900 today!
Generally speaking, if you can provide up-to-date business income evidence, you should.
The reason is that it drastically increases your chances of approval and your opportunity to qualify for a much sharper interest rate than the rates usually applied to low doc mortgages.
The purpose of a low doc solution is to demonstrate your actual business earnings more accurately.
You cannot present misleading financial information for home loan approval purposes, and we will not assist you in doing so.
Lenders look particularly closely at your credit file and the repayment history of your debts because they cannot fully verify your income.
The major banks are far less forgiving of any problems with your credit history.
We do have options with some of our specialist lenders if you have a bad credit history.
Please enquire online or call us on 1800 771 900 to discuss your situation with one of our brokers.
You can refinance out of your current low loc loan when you owe less than 80% of the property value on your mortgage, you are outside of a fixed term and you can provide the following business financials:
Which lender has the lowest interest rates? Which has the lowest LMI premium for their low doc loans? Which lenders do you qualify with?
Our mortgage brokers specialise in low doc mortgages. They can quickly assess your situation and get back to you with the best options.
Please call us on 1800 771 900 or enquire online to go through your situation with an expert.