Low-Doc loans are aimed at self employed borrowers, Pty Ltd or Sole traders. A typical Low-Doc loan requires far less documentation to prove your financial position e.g. income, savings history and one's capacity to meet the loan repayments.
You may need to present recent statements from a business trading account (past three months – to verify a steady consistent income or details of previous tax returns if you have them).
Positives of the Low-Doc Loan:
Low-Doc loans have enabled many borrowers whom have faced rejection from mainstream credit providers, the ability to obtain a mortgage. Low-Doc loans allow borrowers to supply alternative documentation to prove their income/savings history, bringing into reach the opportunity for home ownership for self-employed people.
Supply of sufficiently required documentation, will usually enable the borrowing of approved amounts, at mainstream lending rates.
This loan structure has gained popularity with those whom struggle (self employed, those employed under contract and seasonal workers) to verify their income to the mainstream lenders.
- Borrower signs a declaration acknowledging their income and financial position is true & correct and that the borrower can meet the repayments.
- No supporting documentation required for loans up to 80% LVR.
- Evidence may be required for above 80% LVR loans.
