If you are looking to buy a new home it is better to get the right home rather than the one your bank says you can afford based on outdated tax returns.
If your income is good and your business is strong, then why not use a low doc loan to purchase your home?
You can now borrow up to $1,000,000 without providing the full evidence of your income!
Do I need a deposit?
The major lenders will not lend you more than 80% of the purchase price, requiring you to come up with the other 20% as well as stamp duty.
So you should allow 25% of the purchase price to cover your deposit and other costs.
We have lenders that can approve a 90% low doc loan. These loans are more expensive so we suggest that you provide as large of a deposit as you can. With this option you only need 17% of the purchase price to cover your deposit, costs and risk fee.
Do I need genuine savings?
Most major lenders require you to have saved 20% of the purchase price as either:
- Or equity in another property.
By saving a deposit, you give the lender comfort with the income that you have declared. You also show that you are good at managing your money.
If your deposit is from the sale of an asset, is a gift, is borrowed or comes from some other source, then please call us on 1300 889 743 or enquire online and we will see if we can find you a suitable lender.
Can I get a pre-approval?
Yes, low doc loans are eligible for pre-approvals, depending on the lender. Don’t get confused! Some lenders call a pre-approval a homeseeker, AIP or being conditionally eligible.
Typically a low doc pre-approval will last three months, and if you don’t buy a property in this time your pre-approval will expire. You may be able to obtain an extension on the pre-approval to avoid reapplying for the loan.
Can I get a low doc loan with a family guarantee?
Family guarantees, also known as fast track guarantees, family pledges or family equity loans, are not available for low doc loans.
If you don’t have a deposit then you can consider asking your family to borrow in their name and then lend the money to you for you to use as your deposit.
This is accepted by one or two of our lenders, please call us on 1300 889 743 or enquire online to see if this is suitable for you.
We recommend that you obtain legal advice before proceeding with this structure and always secure the loan with a formal loan agreement and caveat.
Can first home buyers get a low doc loan?
First home buyers can obtain a low doc loan just like any other home buyer. However it is harder to get approved because first home buyers tend to have lower deposits and fewer assets.
Because of this we usually select lenders with cheaper LMI premiums and lower asset requirements.
Applying for a low doc loan will not affect your eligibility for the first home owners grant (FHOG).
Do banks accept any property as security?
The lenders have stricter requirements for the property that is used as security for a low doc loan.
Normal houses or units in capital city or major regional areas are accepted by all lenders. However if you are buying anything unusual then please refer to our low doc security property guide.
How do I apply for a pre-approval?
Our mortgage brokers are specialists in low doc loans and can help you find the right lender.
Just send us an online enquiry or call us on 1300 889 743 and we will be in touch with a few competitive quotes for your loan.