While there are great benefits of having your own business, you might need capital to grow your company as a small business owner. Unfortunately, the tedious criteria of banks or lenders don’t support small businesses immediate financing requirements. Low-doc home loans Australia gives small business owners or self-employed people ample opportunity to secure a home loan.
A low doc mortgage is an ideal home loan solution for self-employed people, contractors, freelancers, and small business owners who have limited documents or cannot fulfil the criteria of lender’s while applying for a loan. However, you can get approved if you have a good credit score or provide self-certification of income.
Here in this blog, we will look at the common misconception associated with low doc loans.
#1 – Low Doc Home Loans Are Expensive
It is not entirely true! Based on the borrower’s financial situation, the loans provided under a low credit policy have a similar interest rate as traditional loans. The only difference is – you do not require to showcase essential documents in Low doc home loans, unlike traditional loans. Even the interest rate and fees are the same as a full-doc loan. But here, you need to deposit 20% of the purchase price to the lender to improve credibility.
#2 – Low doc loans don’t need Paper Work
Contrary to its name, a low document mortgage still requires a few documents to verify your financial position. While applying for a loan, a lender will ask you to provide current assets, evidence of your registered business name, and income declaration from your accountant.
#3 Low doc loans are only available up to 60% of property value
It is not like that; you can get low document loans up to 85% of your property value for a purchase transaction. In general, these mortgages are available up to 80% of property value for purchasing and refinance transactions. Usually, the lower the LVR ratio, the lower the interest rate. In the same way, the higher the LVR, the higher the interest rate. In simple words, you will get a low-interest rate when your lender finds lower risks.
Your Finance Adviser – Trusted Finance Advising Company
We have been helping self-employed and small business owners to attain the dream of having a home in Australia. We have a team of home loan brokers who work dedicatedly to finding the best lender to get the best property value.
Consult with Mr Rohit Khatak, qualified Home Loan Broker Rozelle, for any home loan assistance.
