Like any other home loan, you can make sure you're getting a good deal on a low doc loan by looking at:
A lower interest rate makes the loan cheaper. It's the most important factor when comparing home loans.
Some low doc home loans let you make extra repayments so you can pay it off faster. A redraw facility lets you access those extra repayments to spend if needed. And a loan with an offset account lets you save money while reducing your overall interest charges.
Weigh up the loan's overall fees, including application, settlement and ongoing fees. The fewer the fees, the cheaper the loan.
Some lenders let you borrow up to 80% of a property's value. That means a 20% minimum deposit. For alt or low doc loans lenders often require much higher deposits, but not always.
Compared to regular home loans for borrowers with monthly pay slips, low doc loans usually have:
Low doc home loans suit the following borrowers:
Eligibility requirements differ from lender to lender but you will need an ABN and a good credit history.
If your business is well-established or you've been operating in the same industry for many years, with steady cashflow, and you're able to prove it, some lenders may approve a regular home loan.
Make sure you check with a lender before submitting a full application, or talk to a mortgage broker.
A low doc home loan application will require one or more of the following.
Lenders often use different names for low doc loans, including "business home loans" or alternative (alt) doc loans. This is just a small list of some lenders who provide loans for low doc or similar borrowers.
There's no one best home loan for any borrower. It's all about comparing the rates, fees and loan features.
And the best home loan is often the one you can get when you need it. For some low doc borrowers, an existing business banking relationship with a bank makes it easier to get a loan approved.
If you're starting from scratch, have very limited paperwork or past credit troubles, then a specialist lender like Pepper or Resimac might be better placed to help you.
Yes, low doc loans can be refinanced. But before you start considering refinancing your low doc loan to get a better deal, keep in mind that you will need to essentially reapply for a new loan. You may be subject to stricter eligibility and documentation requirements.
If you're refinancing to a new home loan for a better rate, remember that sometimes the easiest thing to do is let your lender know you're thinking of refinancing and ask for a better rate.
Looking for a cheap home loan? Compare loans here
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Hi, I am currently living overseas but am Australian. I have a large deposit for a property however do not currently have an income as I have returned to studying. I am wondering if a no doc or low doc loan would be possible for me to obtain?
Hi Jay,
Thanks for your question.
A no doc home loan needs to National Consumer Credit Protection Act (NCCP) unregulated. This means that your loan must either be for business purposes, investment purposes or be in the name of a company of trust.
With a low doc loan, you are still required to show some evidence of income, such as a Business Activity Statement or your accountant’s declaration.
It’s advisable for you to speak to a mortgage specialist regarding your situation. They are home loan experts who can help you find the right loan for your situation.
Cheers,
Shirley
I’m an Australian living and working in the UK, I’m a self employed IT contractor i.e. I don’t have an ABN but I have a UK equivalent “Certificate of Incorporation”, in addition my accountants can provide my books/accounts for the revenue/income my business earns.
Will a low doc home loan be feasible in my circumstance?
Hi Ue,
Thanks for your question.
You may be able to work with some of the larger banks here in Australia as they have department dedicated to migrant banking. The following banks have migrant banking facilities available: ANZ,NAB, Westpac and St.George.
Alternatively, a mortgage broker can also help you find a home loan suitable for your situation.
All the best,
Shirley
I am looking for a low doc loan as I am in small business, my home is on 80h 10 minutes out of Canberra NSW Freehold, value $1.8m looking for 50%, do you know what lenders would consider this or is this not a service you provide, I would prefer it not be one of the major 4 banks! My credit Rating is good!
Hi Paul,
Thanks for the question.
You may find lenders that offers low doc home loans to see their lending criteria, rates, fees, and features.
I also recommend getting in touch with a licensed mortgage broker. A broker can help you understand your financial position and they can leverage their panel of networks to find a lender that is more inclined to review your application.
I hope this helps,
Marc
IF i am looking at buying a property for 700k
and put down 350k deposit what documentation will be required to get approval for a low doc loan ?
Hello Roderick,
thanks for the question.
In most cases you’ll need to supply a mixture of: BAS statements for the past 12 months verified by the ATO, 3-6 months worth of account statements for your business, a borrower’s income declaration form, and your ABN.
A mortgage broker can help you with your application – all the best.
I hope this helps,
Marc.