While business owners have a strong hold over their day to day business affairs it can be difficult for them to get a home loan because of the lack of proof of income and financial paperwork that most lenders require. This is where low doc home loans come in and save the day, designed specifically to suit the self-employed.
What is a low doc home loan?
Low doc literally means ‘low documentation’ and refers to financial statements, such as tax returns and pay slips.
Compared to standard home loans, low doc loans allow you to obtain finance with less documentation but also come with the extra price tag of higher fees and greater interest rates.
However, if you do have your financial records up to date you may also be given the option to apply for one of their standard home loans.
These special lending products are available from most banks and institutions and can be used for:
- Investment purposes
- Home owners who are simply living in their own property.
- Business loans
Is a low doc loan right for me?
If you are self-employed or are having difficulties getting a home loan due to an uneven flow of income, then a low doc loan may be suitable for you.
Low documentation loans provide a home lending option for those that have difficulty presenting financial statements about their income. Be sure to check the product disclosure statement if you’re unsure. And if you still have doubts after reading the fine print, speak to a financial advisor.