19 Mar 2022

How Much Can I Borrow with a Low Doc Loan?

Low Doc Loan Borrowing Limits

The lending market generated new home loan options in the late 2000s. Those years brought the low doc loan. Lenders designed this mortgage option for self-employed individuals including small business owners, gig workers, and freelancers. The loan option takes into consideration that applicants will not provide full financial documentation. Therefore, lenders accept alternative financial documentation such as:

  • Tax returns
  • Bank statements
  • Business statements
  • Signed affidavits

Most lenders will finance a 60 to 80% loan-to-value ratio for low doc loans. If the homebuyer provides a 20% deposit, they avoid incurring the lender’s mortgage insurance. 

Mortgage House is a non-bank lender that issues low doc loans to self-employed individuals. Our loan specialists will request alternative financial documentation and evaluate the application as a whole. We place a focus on innovation. Our tools allow our loan specialists to evaluate applications efficiently. Then, they search for the best loan terms for most financial situations. In low doc loan cases, it means balancing several factors. 

For example, applicants who provide a 20% deposit can obtain 80% LVR financing and avoid the lender’s mortgage insurance. Individuals who qualify for 60% LVR financing will incur the LMI and do not need to provide the deposit, especially if it’s not available to them. Instead, they must come up with the outstanding 40% through other means.

Our Mortgage House mortgage repayment calculator helps homebuyers organise their finances.

Low Doc Loan Borrowing Limits Conclusion

Lenders will fund a 60% to 80% loan-to-value ratio for most low doc loan applicants. Applicants can improve their position by providing a deposit, collateral, or a combination of the two. Mortgage House loan specialists help applicants explore their options. Contact our team today.

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