If you're self-employed or earn an irregular income you may still be eligible for a loan – find out about your low doc options.
If you're in need of a personal loan you may feel limited by some of the eligibility requirements. Income and assets can be difficult to prove if you are self-employed or your wealth is tied up in investments. If this is the case, opting for a low doc personal loan may be an option for you to consider.
Compare self-employed personal loans
How do low doc personal loans work?
Low doc personal loans are sought by people who may not have the documentation required to apply for more traditional personal loans. They can be an option if you can't prove a regular income, for example if you're self-employed, or if your income comes from investments. As these loans are risky for lenders, they may come with higher rates and fees.
What features come with these loans?
Low doc personal loans generally come with the same features as other personal loans as well as flexible eligibility features which can make them an option for people who do not qualify for other forms of credit. Some of the features include:
- Standard application. These loans require less documentation than others, but the application process is usually the same as a regular personal loan. The lender will still need evidence that you're able to repay the loan, whether it be through tax statements or bank statements.
- Fees and rates. As these loans require less proof of financial stability, lenders may charge higher fees and rates to offset the risk of lending the money.
- Variable or fixed. Depending on the loan you opt for you may be able to select a fixed or variable rate option to suit your financial needs.
- Flexible loan purposes. Low doc personal loans may allow you to borrow money to finance personal or business needs, making them a suitable option to consider for various types of loan requirements.
How self-employed applicants can be approved for loans
There's no one way to make sure you're approved for a loan, but here are a few options to keep in mind if you're looking for financing while receiving an irregular income:
- Consider a guarantor. By applying with a guarantor you can give a lender a guarantee that the loan will be repaid.
- Apply with another person. A joint application is different to a guarantor – you and the person you're applying with are equally responsible for the loan. You both need to meet the criteria but it can also help to bolster your application.
- Have at least two years of tax returns. This is a standard requirement for lenders, so ensure you have this when you are comparing.
Weigh up the benefits and drawbacks before applying
- These personal loans are an option for people who may not be able to apply for traditional personal loans
- Less documentation is required to apply for these loans, which makes for a quick and easy application process
- Low doc loans tend to have higher rates and fees
- You might find fewer features and less flexibility than other personal loans
Is there anything to consider before you apply?
Before you apply for a low doc personal loan, consider the following:
- Do you need the loan? The low doc features of these loans may attract borrowers for the wrong reasons. If you do not have a reliable income or stable assets to show as evidence to a lender then you may want to consider your ability to make the repayments. Decide if your financial situation is stable and if any changes could occur that may affect your ability to repay the loan.
- Have you planned your repayments? Not planning for a loan and how you're going to repay it is a common mistake, but one that can cost you if you miss any payments. Calculate your repayments and work out whether they will be manageable on your budget. This is even more important for low doc loans if you earn an irregular income or have unstable assets.
- Why are you applying? The purpose of the loan should also be considered. For instance, if you are looking at financing a car then you can consider a secured personal loan as you may be able to get a lower rate. If you want to make improvements to your home you can consider a home equity loan/line of credit.
Here's how you can apply
To apply for a low doc personal loan you can click on the "Go to Site" button for any of the brands you see on the page above. From there you will need to provide proof of your identity and also certain financial details. Eligibility requirements differ for each loan, and you can check these by clicking on the name of the loan and reading the review page before applying. To apply, you will generally need to be over the age of 18 and be a permanent Australian resident. Lenders will differ on their requirements regarding your credit history.