LOW DOC LOANS FOR THE SELF EMPLOYED AUSTRALIAN
Unfortunately there are many self employed people who due to their circumstances do not have the documentation they need to apply for a prime loan to purchase or refinance a home, commercial property or a car or asset finance. Up until relatively recently these people were left unable to finance Property or Business Assets and this caused a lot of frustration. Today thanks to low doc loans people who are self employed and are unable to provide full documentary evidence of their income can successfully apply for a mortgage or a car loan in Australia.
What is a Low Doc Loan?
For these low doc loans, you will need to provide the lender with a statement confirming your income generally certified by your accountant or Business Bank Statements or BAS Statements or a combination of above to support your statement of income. Compared to full doc, these sub prime loans generally carry a higher interest rate and are available only at lower Loan Valuation Ratios (LVRs) compared to Prime Loans. It is recommended that you refinance to a full doc loan once you have completed your Tax Returns.
Either of these main documents that can be used to verify your income are:
- An Accountant Letter verifying your Business Income after add-backs and before Tax.
- 6 to 12 months of Lodged BAS Statements from ATO Portal.
- 6 to 12 months of Business bank statements which confirm income and expenses.
- Ongoing Contracts for Self Employed Contractors.
- Old tax returns (over 24 months) in combination with current financial statements
Who can apply for a Low Doc Loan?
The kind of people who take out low doc loans include self employed individuals who do not have weekly or monthly pay slips to provide a funder. As with any type of loan there are various low doc options that a person can choose from. Many people who are self employed will find that this kind of low document loan to buy a property or obtain cash out is right for them. If you have recently started out in self employed employment and do not have 2 years of lodged accounts to provide evidence of your income or maybe you are self-employed and have a complex business structure, or your Tax Returns are not up to date, or your income has increased since your last Tax Return, then a Low Doc Home Loan may just be the answer for you.
Why choose us?
- We do all the running around for you, saving you time and making the task of finding a home loan easy and less confusing.
- We provide you with a written credit proposal document for your protection which discloses all commission and payments received.
- We do not sell our own home loans and therefore are not an agent for one lender in disguise.
Getting the right advice
Low doc lending is a specialist lending area and now it is more important than ever to obtain the right advice from people with the necessary skills and experience to provide you with the best lending solution.
So, if you are self-employed with an income that can be substantiated using documentation other than 2 years of lodged Tax Returns then a Low Doc Loan might just be the solution you need.
We are a full member of the MFAA (Mortgage and Finance Association of Australia). All our brokers are members of the MFAA and must have completed Certificate IV and a Diploma in Financial Services (Finance/Mortgage Broking).
To find out which Lender has the right low doc mortgage for your circumstances complete our online form or call 1300 791 329Â and talk to one of our Specialist Brokers.
What do Lenders look for
in assessing a Low Doc Loan?
Every lender has different policies, however there are some standard criteria for most lenders.
- Length of ABN / GST registration: You must have an ABN that has been registered (and possibly GST registered if sales are over $75,000) Most Lenders require ABN to be registered for 2 years. We have lenders that will accept an ABN registered for 6 months.
- LVR: Some Banks will accept low doc loans up to 60% LVR at standard rates, and some will consider up to 80% LVR on Purchases. Generally above 60% for refinance or cash out we will need to apply through a specialist lender.
- Reasonable income declared for the business: Lenders look to see if income and current assets are in line with type of Business and age of Applicant.
- Clean credit: Prime Lenders will not approve a low doc loan with any problems with your credit history. We have Specialist Lenders that will lend to 90% with credit impairments
- Security: Funders may take a risk on the applicant but not on the security. Properties that are in non metro or low regional population arrears or unique, in disrepair or difficult to sell are usually not accepted.
- Cash out: Most Funders will not allow cash out above 60% LVR and require proof of how the loan funds will be used. We have Specialist Lenders that will allow cash out to 85% LVR.
- Debt Consolidation: Most lenders will not refinance an existing loan to Consolidate Debt above 80% LVR. We have Specialist Lenders that will allow Debt Consolidation to 90% LVR
Low Doc Car Loans
Apply for a low doc car loan in minutes, without painful paperwork or waiting in queues. No deposit required if you have equity in real estate or a 20% Deposit applies (either through a trade-in or via cash deposit) – Business ABN registration required – Fast decision and funding usually same business day – Online application takes just ten minutes – Available for other Assets Purchases on different Terms & Rates – Apply now…
Low Doc Unsecured Business Loans
Apply online now and receive a decision in hours and start growing your business. Amounts from $2,000 to $300,000 – Unsecured – Terms from 1-12 months – Cash-flow friendly repayments – Fast decision and funding usually same business day – Online application takes just ten minutes – 90% of Customers receive their funds within 24 hours – Apply now…