Are no doc loans not offered anymore?

Share your concerns & ideas about commercial property loans in Australia.
Post Reply
User avatar
Otto Dargan
Mortgage Specialist
Posts: 7730
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
Contact:

Re: Are no doc loans not offered anymore?

Post by Otto Dargan »

Hi and welcome to the forums batman.

The mortgage market has changed drastically because of the Global Financial Crisis (GFC) which peaked in Australia around mid-2007.

Before the GFC, there were many lenders who offered specialised loans to meet the needs of those who could not meet the standard lending criteria. One of such specialised loans were no doc loans.

When the GFC hit Australia, Reserve Bank of Australia (RBA) introduced tighter lending policies, due to which, lenders threw out no doc loans.

However, you can still get a no doc loan through some specialist lenders.

Cheers,
Otto
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

User avatar
Otto Dargan
Mortgage Specialist
Posts: 7730
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
Contact:

Re: Are no doc loans not offered anymore?

Post by Otto Dargan »

Hi batman,

You may be able to borrow:
  • 60% of the property value through larger second tier lenders at competitive interest rates.
  • 75% of the property value through smaller lenders at higher interest rates.
  • 80% of the property value, however, you can only obtain short term caveat loans, typically at an expensive interest rate.
It should be noted that you may not be able to borrow more than one million dollars.

It should also be noted that these lenders offer no doc loan mostly based on the strength of the property itself and not your income. They are very particular about the property and prefer it to be:
  • In a good location.
  • In good condition.
  • Larger than 50 meter square for a unit or under two hectares for land.
  • Readily saleable.
Offices, factories, warehouses and retail may be acceptable for a commercial no doc.

You can go through our website to learn more about no doc loans. If you want to speak with a broker directly, then you can give us a call on 1300 889 743 or you can fill in our free assessment form and one of our brokers will contact you instead.

Cheers,
Otto
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

User avatar
Otto Dargan
Mortgage Specialist
Posts: 7730
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
Contact:

Re: Are no doc loans not offered anymore?

Post by Otto Dargan »

Hi clarke,

There are several private lenders that fund no doc loans. Most of them operate through a specialist mortgage broker and are far more expensive than the major lenders in Australia. The interest rates may be up to 6% per month, which is up to 72% per annum.

That’s why no doc loans aren’t normally designed to be for a long period of time. In most cases they have a term of six to twelve months.

One of the way out of the no doc loan is getting a refinance using a low doc loan, given that you can meet all the requirements of a low doc loan.

It should be noted that if you’re going through a mortgage broker, then they’ll charge you a fee to arrange your no doc loan because most private lenders don’t pay them any commissions.

It is strongly recommended that you use a no doc loan only as a last resort and that you obtain legal and financial advice before signing the loan agreement.

Cheers,
Otto
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

Post Reply