26 Oct 2021

Low Doc Loans

Low Doc Loans

Low documentation (low doc) loans are home loans you can be approved for even if you cannot provide the standard income verification documents. Low doc loans are reserved for self-employed or contract borrowers who can provide a signed income declaration, BAS, business account statements, or a certified letter from their accountant. Most lenders provide low doc loans without needing to see tax returns or financial statements, as long as you can provide one of the items listed above. 

Difference Between a Full Doc Loan and Low Doc Loan for Self-Employed Borrowers

If you are self-employed, you know most lenders see you as a high-risk borrower because of possible income fluctuations. If you’ve been self-employed for more than two years, it is easier for you to secure a home loan because you can provide the following documents:

  • Two years’ worth of business and personal tax returns and assessments
  • Two years’ worth of business and personal financial statements

However, if you’ve been self-employed for less than two years, you cannot provide the above financial documents. You can apply for a low doc loan using just a BAS, business account statements, or a letter from your accountant. 

Who Can Be Approved for a Low Doc Home Loan?

In addition to the newly self-employed, low doc loans can benefit those who need to borrow more than 80% of their property’s value, those with poor credit scores or defaults on their credit history, and those who are purchasing their first home. 

While low doc loans can have stricter lending requirements and higher interest rates, the low doc loan products offered by Mortgage House are more competitive. Contact our lending specialists today to see if you qualify for a low doc loan with a lower interest rate.

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