I got declined by St George - Are there lenders that accepts 1 years' tax returns

Any general questions you might have in regards to loans and finance.
Post Reply
User avatar
Otto Dargan
Mortgage Specialist
Posts: 7730
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
Contact:

Re: I got declined by St George - Are there lenders that accepts 1 years' tax returns

Post by Otto Dargan »

Hello Deepak. Welcome to the forums.

St George no longer accepts 1-year financials for self-employed borrowers. However, there are other lenders who do accept 1-year tax returns as income evidence/verification. In addition, many of our lenders allow small business owners to add back the full amount spent on capital assets to your taxable income as well. So, yes, there are a couple of good lender options for you.

Each lender has its own policy on how they calculate income for self-employed where there’s a huge disparity between the last two years’ income.
  • Some lenders may use the average of the two years’ taxable income or take 120% of the lowest year’s income;
  • While some may use the most recent tax returns;
  • Another lender may use the lowest of the income figures from the past two years;
  • Lenders may or may not allow add back expenses shown on your tax returns.
Depending on your situation, we’ll work out which information to provide to help prove the highest income; whether it’s through your BAS (business activity statements), ATO tax portal printout or bank account statements from the past three to six months.

Give us a call on 1300 889 743 or fill in our free assessment form to find out if you qualify for a self-employed home loan.

Cheers,
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: I got declined by St George - Are there lenders that accepts 1 years' tax returns

Post by Otto Dargan »

Hi Deepak,

Lenders Mortgage Insurance (LMI) typically only applies when the loan to value ratio is above 80% for standard full doc loans. If it’s a low doc loan then LMI or risk fee applies when borrowing over 60% of the property value.

Some lenders effectively self-insure their home loans, that means there is no third party insurer, however, you’ll still pay a risk fee instead of LMI. Just like LMI, risk fees tend to vary between lenders. Our mortgage brokers know which lenders have the most competitive LMI/risk fee for your low doc loan.

Cheers,
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: I got declined by St George - Are there lenders that accepts 1 years' tax returns

Post by Otto Dargan »

Hi Deepak,

Once you have your two years’ financials showing the increased income you can refinance from low doc to full doc to get a sharper rate. Low docs are considered riskier by the banks as you’re only providing limited income evidence so, they tend to charge a slightly higher interest rate. Once you can provide the necessary documents required, you’re no longer considered higher risk so, you can qualify for a more competitive interest rate.

In order to qualify for a full doc self-employed loan, you’ll need:
  • Last two years’ financial statements (profit and loss and balance sheet).
  • Last two years’ business tax returns.
  • Last two years’ personal tax returns.
  • Last two years’ notices of assessment.
  • Last 6 months home loan statements.
There are more than just interest rate considerations to make, you’ll also need to look at the LMI premium, application fees, loan amount, and the income verification requirement. The key to getting a good deal is applying with the right lender.

Give us a call on 1300 889 743 or fill in our free assessment form to find out if you qualify for aself-employed home loan with alternative income verification.

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

Post Reply