No BAS Low Doc
Not all lenders need BAS statements!
In early 2009, only a few lenders required some kind of proof of income for low documentation loans.
Due to the Global Financial Crisis (GFC) and the introduction of the National Consumer Credit Protection Act (NCCP), lenders began to ask for Business Activity Statements (BAS) to support the borrower’s declared income.
By January 2011, almost all Australian lenders had tightened their low doc loan lending policies by requesting BAS to support the income declared by the borrowers.
At present, most lenders now require a minimum of 12 months BAS statements from new loan applicants as part of their updated ‘responsible lending’ requirements.
Do I need to provide BAS?
There are a few select lenders who can assist you with a loan even without BAS statements. In many cases the rate is actually lower than the Bank Standard Variable (BSV) rate!
What are the lenders' guidelines?
Every lender has different policies when it comes to guidelines and required documents.
However as a general rule, to qualify for a loan you must meet the following criteria:
- Your ABN and GST must be registered for a minimum of 2 years.
- Your credit history must be clear of any adverse listings and you must be paying your current debts on time.
- You must provide either an accountant’s letter, business bank account statements to verify your income or apply for a no doc loan.
- You must be borrowing 80% or less of the property value.
Why does each lender have different requirements?
Each lender will require some form of income evidence to support the income that you have declared, as this is now required under Australian law.
However they can choose any number of methods to verify your income. Most lenders prefer to obtain BAS statements, however some will accept an accounant’s letter or business bank account statements instead.
Please call us on 1300 889 743 or enquire online to discuss which methods of verification will work for your situation.
What if I'm not GST registered?
Obviously if you aren’t registered for GST then you can’t provide BAS statements!
One of our lenders will still allow you to apply for a low doc loan. The income that you are declaring must be under $75,000 or there is some reason why you would not need to be GST registered.
Please see our page on getting a low doc loan with an accountants letter.
What if my ABN is not 2 years old?
- 1 year old ABN: You can borrow up to 60% of the property value at a discounted interest rate or up to 80% with a very select number of lenders.
- More than 2 years old ABN: Normal policy applies. You can borrow up to 80% of the property value at discounted interest rates.
What if I apply with a lender that needs BAS statements?
You will need to provide your last 12 months of BAS statements issued from the ATO (not the copy that you sent to the ATO). You can print these from the ATO’s Business Portal or by asking your bookkeeper / accountant.
The lender will usually look at the turnover of your business during the last year as shown on your BAS and assume your income to be the lesser of 40% of your turnover or the income you declared. Consultants and other business types that have low expenses may be able to declare an income as high as 80% of their turnover.
In other cases, lenders may also ask for 3 to 6 months of business bank statements as evidence of genuine savings to assist in their assessment. Lenders may also ask for other documents such as your annual GST return or evidence that your quarterly GST bill has been paid by the due date.
How to apply for a mortgage?
Enquire online or call us on 1300 889 743 to talk to a specialist mortgage broker who knows how to get you a competitive low doc loan without the need to show your BAS statements.