While being self-employed has its advantages, it can make applying for a standard home loan more complicated.

Without access to regular payslips or salary documentation, low-doc home loans give freelancers, contract workers, investors and self-employed borrowers the option of applying for a home loan with less documentation than standard home loans.

Find and compare low doc home loans

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3.39%

Variable

3.59%

Pepper

$1.5k

Redraw facility
Offset Account
Borrow up to 85%
Extra Repayments
Interest Only
Owner Occupied

2.03

/ 5
More details

2.85%

Variable

3.05%

Pepper

$1.4k

Redraw facility
Offset Account
Borrow up to 65%
Extra Repayments
Interest Only
Owner Occupied

2.59

/ 5
More details

2.85%

Variable

3.05%

Pepper

$1.4k

Redraw facility
Offset Account
Borrow up to 70%
Extra Repayments
Interest Only
Owner Occupied

2.59

/ 5
More details

2.99%

Variable

3.19%

Pepper

$1.4k

Redraw facility
Offset Account
Borrow up to 75%
Extra Repayments
Interest Only
Owner Occupied

2.27

/ 5
More details

3.09%

Variable

3.29%

Pepper

$1.4k

Redraw facility
Offset Account
Borrow up to 80%
Extra Repayments
Interest Only
Owner Occupied

2.03

/ 5
More details

3.35%

Variable

3.55%

Pepper

$1.5k

Redraw facility
Offset Account
Borrow up to 70%
Extra Repayments
Interest Only
Owner Occupied

2.03

/ 5
More details

3.35%

Variable

3.55%

Pepper

$1.5k

Redraw facility
Offset Account
Borrow up to 65%
Extra Repayments
Interest Only
Owner Occupied

2.03

/ 5
More details

3.35%

Variable

3.55%

Pepper

$1.5k

Redraw facility
Offset Account
Borrow up to 65%
Extra Repayments
Interest Only
Owner Occupied

2.03

/ 5
More details

3.35%

Variable

3.55%

Pepper

$1.5k

Redraw facility
Offset Account
Borrow up to 70%
Extra Repayments
Interest Only
Owner Occupied

2.03

/ 5
More details

3.60%

Variable

3.66%

Yellow Brick Road

$1.5k

Redraw facility
Offset Account
Borrow up to 60%
Extra Repayments
Interest Only
Owner Occupied

2.03

/ 5
More details

3.60%

Variable

3.66%

RESI Mortgage Corp

$1.5k

Redraw facility
Offset Account
Borrow up to 60%
Extra Repayments
Interest Only
Owner Occupied

2.03

/ 5
More details

3.60%

Variable

3.66%

Yellow Brick Road

$1.5k

Redraw facility
Offset Account
Borrow up to 60%
Extra Repayments
Interest Only
Owner Occupied

1.95

/ 5
More details

3.49%

Variable

3.69%

Pepper

$1.5k

Redraw facility
Offset Account
Borrow up to 75%
Extra Repayments
Interest Only
Owner Occupied

2.03

/ 5
More details

3.49%

Variable

3.69%

Pepper

$1.5k

Redraw facility
Offset Account
Borrow up to 75%
Extra Repayments
Interest Only
Owner Occupied

2.03

/ 5
More details

3.59%

Variable

3.79%

Pepper

$1.5k

Redraw facility
Offset Account
Borrow up to 80%
Extra Repayments
Interest Only
Owner Occupied

2.03

/ 5
More details

3.59%

Variable

3.79%

Pepper

$1.5k

Redraw facility
Offset Account
Borrow up to 80%
Extra Repayments
Interest Only
Owner Occupied

2.03

/ 5
More details

3.69%

Variable

3.88%

Pepper

$1.5k

Redraw facility
Offset Account
Borrow up to 90%
Extra Repayments
Interest Only
Owner Occupied

2.03

/ 5
More details

3.97%

Variable

4.01%

Resimac

$1.6k

Redraw facility
Offset Account
Borrow up to 70%
Extra Repayments
Interest Only
Owner Occupied

1.78

/ 5
More details

4.12%

Variable

4.06%

Resimac

$1k

Redraw facility
Offset Account
Borrow up to 70%
Extra Repayments
Interest Only
Owner Occupied

1.78

/ 5
More details

3.89%

Variable

4.08%

Pepper

$1.6k

Redraw facility
Offset Account
Borrow up to 85%
Extra Repayments
Interest Only
Owner Occupied

2.03

/ 5
More details

What is a low-doc home loan?

Low-doc home loans get their name from providing low documentation. For borrowers who are self-employed, those who freelance or own their own small business, getting access to payslips and group certificates can be challenging. The lack of traditional documentation can make applying for a standard mortgage a little trickier. That’s where a low-doc home loan comes in, giving non-traditional borrowers access to home loans minus the usual documentation.

Low-doc home loans are generally designed for self-employed borrowers who have the deposit and income to be able to pay off a mortgage but may not have all the standard documentation to prove it.

Back in the 1990s, mortgage brokers recognised that not all lenders fit into one category. Discovering a valuable niche in self-employed lending, they tapped into this group of viable borrowers and created a new category of home loans called low-doc home loans.

Until low-doc home loans came along, getting access to a mortgage was difficult for non-traditional borrowers. What low-doc loans do is provide self-employed, freelancers and small business owners with the ability to provide different kinds of proof of income documentation when applying for a home loan.

With the number of self-employed borrowers on the rise, the increasing demand for low-doc home loans means there are a lot more options available for non-traditional borrowers. With low-doc home loans now available from all sorts of lenders, it’s important to compare your options and find the best low-doc home loan for you.

As self-employed borrowers generally don’t look as solid on paper as more traditional employees with pay slips, banks and lenders offering low-doc home loans will often insist borrowers pay a larger deposit, and some low-doc home loans may have higher interest rates than traditional loans. Having an excellent credit history can help to maximise your available options.

While each low-doc home loan lender will have their own rules and conditions, self-employed borrowers will generally have to provide at least two years of personal tax returns, business activity statements (BAS), profit and loss statements, other relevant financial statements and in some cases an accountant’s letter verifying their financial position.

How to compare low-doc home loans

Low-doc home loans have come a long way in recent years. With many options on the market, there’s no such thing as a one-size-fits-all low-doc home loan. Some lenders may offer specific low-doc home loans, while others may offer a low-doc version of a regular home loan. With so many options on the market, it can be hard to know how to compare low-doc home loans. Here’s what to look out for when comparing low-doc home loans.

Interest rate

Start by looking at the interest rate. Depending on the low-doc home loan, you may have the option of choosing either fixed or variable interest rates. A fixed-rate option will allow you to set the interest rate for a period. While the fixed interest rate is usually higher than a variable rate, it will give you the certainty of making set repayments for a fixed period. Your other option is to pick the variable rate and wear the risk that rates may rise, which will make your repayments more expensive. Some low-doc home loans offer a split rate option which lets you split part of your loan between both a fixed and a variable interest rate.

Loan type

When you apply for a home loan, you’ll need to pay back both the principal amount you borrow and the interest. Some low-doc loans may offer an interest-only option, which lets you pay back the minimum amount of interest and not the principle for a fixed period.

Loan features

When comparing low-doc home loans, it’s important to look beyond the interest rate. The interest rate is an important factor to consider and compare, but there are many other aspects to weigh up.

Extra repayments

You might want a loan that allows you to make extra repayments. If you’re self-employed or freelancing, there may be periods of time when you’re earning more. In those periods, you may want to use the extra cash to pay down your home loan. A loan that allows you to make additional repayments will let you pay extra into your home loan which will ultimately reduce the amount of interest you pay over the life of the loan. Bear in mind that some loans that offer this feature may charge a small fee for it.

Redraw facility

If your cash flow is unstable or varies throughout the year, a loan which offers a redraw feature may help buffer any ebbs and flows. A redraw facility allows you to withdraw any additional repayments you’ve made into your home loan. While the money is there to be redrawn, remember that you’ll still have to pay it back and it may push your repayment amounts up. As low-doc home loans generally tend to have lower interest rates than credit cards and personal loans, it can make more financial sense to use the redraw facility than applying for a personal loan.

Offset account

If you’ve got savings or any extra cash sitting in a savings account, you might want a low-doc home loan with an offset account. An offset account that’s attached to your home loan may help save you interest and potentially shave years off your loan. For example, if you’ve got a $500,000 home loan and a balance of $40,000 in an offset account, you’ll only be charged interest on the balance of $460,000. The amount in your offset account is offset against the loan balance, potentially saving you interest and money over the life of the loan.

Generally speaking, offset accounts are usually only available with variable interest rate low-doc home loans, so before you apply, do your research to find a loan that suits your needs.

Other features to consider

Given that low-doc home loans are generally riskier from a lender’s perspective, the bank may require a bigger deposit than a full-doc home loan. When you’re comparing low-doc home loans, look out for the loan-to-value ratio (LVR) percentages. As a general rule, loans that have a LVR of over 80 per cent are required to pay lender’s mortgage insurance (LMI). To avoid any extra charges, take note of the LVR and deposit requirements.

Other low-doc home loan features to look out for include loan portability which lets you take your low-doc home loan with you when you move, instead of refinancing

Depending on your cash flow, you may be able to find a loan that lets you change your repayments from monthly to weekly or fortnightly.

How do I apply for a low-doc home loan in Australia?

Once you’ve compared your low-doc home loan options, found a loan that suits you, and checked that you meet the eligibility requirements, you will need to gather your documentation before you apply. While each lender has their own home loan application process, they may generally require some or all of the following documentation:

  • Proof of identification
  • Proof you’ve been working in the same industry for at least 12 months
  • A registered business name and an ABN
  • At least 12 months of lodged business activity statements (BAS statements)
  • Proof of registration of GST
  • Personal and business bank statementsAn income declaration from your accountant

Frequently asked questions

Who has the best home loan?

Determining who has the ‘best’ home loan really does depend on your own personal circumstances and requirements. It may be tempting to judge a loan merely on the interest rate but there can be added value in the extras on offer, such as offset and redraw facilities, that aren’t available with all low rate loans.

To determine which loan is the best for you, think about whether you would prefer the consistency of a fixed loan or the flexibility and potential benefits of a variable loan. Then determine which features will be necessary throughout the life of your loan. Thirdly, consider how much you are willing to pay in fees for the loan you want. Once you find the perfect combination of these three elements you are on your way to determining the best loan for you. 

How do I take out a low-deposit home loan?

If you want to take out a low-deposit home loan, it might be a good idea to consult a mortgage broker who can give you professional financial advice and organise the mortgage for you.

Another way to take out a low-deposit home loan is to do your own research with a comparison website like RateCity. Once you’ve identified your preferred mortgage, you can apply through RateCity or go direct to the lender.

How can I get a home loan with no deposit?

Following the Global Financial Crisis, no-deposit loans, as they once used to be known, have largely been removed from the market. Now, if you wish to enter the market with no deposit, you will require a property of your own to secure a loan against or the assistance of a guarantor.

What is an ombudsman?

An complaints officer – previously referred to as an ombudsman -looks at formal complaints from customers about their credit providers, and helps to find a fair and independent solution to these problems.

These services are handled by the Australian Financial Complaints Authority, a non-profit government organisation that addresses and resolves financial disputes between customers and financial service providers.

What factors does Real Time Ratings consider?

Real Time RatingsTM uses a range of information to provide personalised results:

  • Your loan amount
  • Your borrowing status (whether you are an owner-occupier or an investor)
  • Your loan-to-value ratio (LVR)
  • Your personal preferences (such as whether you want an offset account or to be able to make extra repayments)
  • Product information (such as a loan’s interest rate, fees and LVR requirements)
  • Market changes (such as when new loans come on to the market)

What is a redraw fee?

Redraw fees are charged by your lender when you want to take money you have already paid into your mortgage back out. Typically, banks will only allow you to take money out of your loan if you have a redraw facility attached to your loan, and the money you are taking out is part of any additional repayments you’ve made. The average redraw fee is around $19 however there are plenty of lenders who include a number of fee-free redraws a year. Tip: Negative-gearers beware – any money redrawn is often treated as new borrowing for tax purposes, so there may be limits on how you can use it if you want to maximise your tax deduction.

Interest Rate

Your current home loan interest rate. To accurately calculate how much you could save, an accurate interest figure is required. If you are not certain, check your bank statement or log into your mortgage account.

What is appreciation or depreciation of property?

The increase or decrease in the value of a property due to factors including inflation, demand and political stability.

Mortgage Calculator, Repayment Type

Will you pay off the amount you borrowed + interest or just the interest for a period?

How common are low-deposit home loans?

Low-deposit home loans aren’t as common as they once were, because they’re regarded as relatively risky and the banking regulator (APRA) is trying to reduce risk from the mortgage market.

However, if you do your research, you’ll find there is still a fairly wide selection of banks, credit unions and non-bank lenders that offers low-deposit home loans.

What does going guarantor' mean?

Going guarantor means a person offers up the equity in their home as security for your loan. This is a serious commitment which can have major repercussions if the person is not able to make their repayments and defaults on their loan. In this scenario, the bank will legally be able to the guarantor until the debt is settled.

Not everyone can be a guarantor. Lenders will generally only allow immediate family members to act as a guarantor but this can sometimes be stretched to include extended family depending on the circumstances.

How much deposit do I need for a home loan from NAB?

The right deposit size to get a home loan with an Australian lender will depend on the lender’s eligibility criteria and the value of your property.

Generally, lenders look favourably on applicants who save up a 20 per cent deposit for their property This also means applicants do not have to pay Lenders Mortgage Insurance (LMI). However, you may still be able to obtain a mortgage with a 10 - 15 per cent deposit.  

Keep in mind that NAB is one of the participating lenders for the First Home Loan Deposit Scheme, which allows eligible borrowers to buy a property with as low as a 5 per cent deposit without paying the LMI. The Federal Government guarantees up to 15 per cent of the deposit to help first-timers to become homeowners.

How much are repayments on a $250K mortgage?

The exact repayment amount for a $250,000 mortgage will be determined by several factors including your deposit size, interest rate and the type of loan. It is best to use a mortgage calculator to determine your actual repayment size.

For example, the monthly repayments on a $250,000 loan with a 5 per cent interest rate over 30 years will be $1342. For a loan of $300,000 on the same rate and loan term, the monthly repayments will be $1610 and for a $500,000 loan, the monthly repayments will be $2684.

What is appraised value?

An estimation of a property’s value before beginning the mortgage approval process. An appraiser (or valuer) is an expert who estimates the value of a property. The lender generally selects the appraiser or valuer before sanctioning the loan.

What is a fixed home loan?

A fixed rate home loan is a loan where the interest rate is set for a certain amount of time, usually between one and 15 years. The advantage of a fixed rate is that you know exactly how much your repayments will be for the duration of the fixed term. There are some disadvantages to fixing that you need to be aware of. Some products won’t let you make extra repayments, or offer tools such as an offset account to help you reduce your interest, while others will charge a significant break fee if you decide to terminate the loan before the fixed period finishes.

What happens to your mortgage when you die?

There is no hard and fast answer to what will happen to your mortgage when you die as it is largely dependent on what you have set out in your mortgage agreement, your will (if you have one), other assets you may have and if you have insurance. If you have co-signed the mortgage with another person that person will become responsible for the remaining debt when you die.

If the mortgage is in your name only the house will be sold by the bank to cover the remaining debt and your nominated air will receive the remaining sum if there is a difference. If there is a turn in the market and the sale of your house won’t cover the remaining debt the case may go to court and the difference may have to be covered by the sale of other assets.  

If you have a life insurance policy your family may be able to use some of the lump sum payment from this to pay down the remaining mortgage debt. Alternatively, your lender may provide some form of mortgage protection that could assist your family in making repayments following your passing.

Mortgage Balance

The amount you currently owe your mortgage lender. If you are not sure, enter your best estimate.

Do other comparison sites offer the same service?

Real Time RatingsTM is the only online system that ranks the home loan market based on your personal borrowing preferences. Until now, home loans have been rated based on outdated data. Our system is unique because it reacts to changes as soon as we update our database.

What is a specialist lender?

Specialist lenders, also known as non-conforming lenders, are lenders that offer mortgages to ‘non-vanilla’ borrowers who struggle to get finance at mainstream banks.

That includes people with bad credit, as well as borrowers who are self-employed, in casual employment or are new to Australia.

Specialist lenders take a much more flexible approach to assessing mortgage applications than mainstream banks.

What is bridging finance?

A loan of shorter duration taken to buy a new property before a borrower sells an existing property, usually taken to cover the financial gap that occurs while buying a new property without first selling an older one.

Usually, these loans have higher interest rates and a shorter repayment duration.