A Complete Guide on Low Documentation Home Loans

The low documentation home loans, also known as low doc home loans, are a type of lending solutions for self-employed borrowers. It is designed for investors or self-employed, borrowers, contractors, freelancers and other people who have no regular jobs and are unable to file tax returns as they cannot prove their income through traditional means such as providing pay slips.  


low doc home loans


Features included in low doc home loans 


Low doc home loans come with the following features: 

  • Fixed interest rates 
  • Multiple loan accounts 
  • Additional Repayments 
  • Redraw facilities 
  • Offset account 
  • Flexible rates 

Features that are not included in low doc home loans 

  • third-party guarantees 
  • introductory interest rates 
  • repayment holiday 
  • security substitution (in some instances) 

Documents required for applying to low-doc home loans 


While this loan does not require showing much evidence as compared to the traditional home loans, there are still two or more copies of the following documents required to be submitted to the lender in order to complete the loan application process: 

  • a signed Borrower’s Income Declaration stating your usual income 
  • registered business name and Australian Business Number (ABN) 
  • 12 months’ worth of Business Activity Statements (BAS) 
  • a letter from your accountant 
  • previous bank statements (usually over six months) 
  • old tax returns (over 24 months) 
  • interim financial statements 

Advantages of low doc home loans  


Low doc home loans offer the following benefits to the borrower: 

  • Simple income declaration form 
  • Alternatives to tax returns as income evidence are available 
  • Fully serviceable loan options, redraws, line of credit, variable or fixed rates 
  • Principal & Interest or Interest-only loans 

Disadvantages of low doc home loans   


Although low doc home loan can be extremely beneficial for the self-employed borrowers, there are some drawbacks of this loan too. These are:

 

  • Higher interest rate and potentially fewer features 
  • Not every bank or lender offers low doc loans 


Experts Advice on low doc home loans by Your Finance Adviser

 

Your Finance Adviser is a reputed finance advising company in Australia. We specialise in providing home loan advice to people to fulfil their dreams of owning a home in Australia. We can guide you in getting the perfect home loan that fits into your budget. Our experts' team of home loan advisor will assist and guide you thoroughly about low doc home loans and help you in understanding the loan's features and eligibility criteria.  


You can call us right away on 1300932276 or email us at info@yourfinanceadviser.com.au 

Location: Sydney NSW, Australia

Comments

  1. MagmaloanAugust 28, 2021 at 1:12 PM

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