Why do self employed loans differ from standard loans?

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The short answer is income verification. A borrower that's earning a salary shows consistent income which makes it easier for a lender to assess the application.

A self employed borrower generally has fluctuating income, so lenders like to take an annual or bi-annual sample to determine what income to use for the application.​

What businesses are eligible?

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✅ Most lenders require 18-24 months ABN registration

✅ Some lenders will accept 6 months ABN registration

✅ Most lenders require GST registration

✅ Some lenders can consider a new business (start up)​

How do I prove my income as a self-employed borrower?

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This varies lender to lender, but the most common can consist of:

✅ Accountant prepared tax returns

✅ Bank statements

✅ Payslips (if you pay yourself a salary)

✅ BAS statements

✅ Accountant letters

How much can I borrow as a self employed customer?

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✅ Borrow up to 95% of the property value with one or two years’ tax returns.

✅ Borrow 80% - 90% of the property value with little to no income verification (low doc loan).

✅ Borrow up to 80% of the property value if you’ve been self-employed for less than a year.

What if I’ve been self-employed for less than a year?

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If you’ve been self-employed for less than one year there aren’t many options. Most banks won’t lend to you because you don’t yet have tax returns to prove your income and because new businesses have more financial uncertainty.

BUT, some of our lenders can look at your income from your last job and take that as proof that you can afford the loan if you're in a similar industry. The reasoning behind this is that if you decided to close your business you could always return to working for someone else on a similar salary to your previous job. On that basis we can help you borrow up to 80% of the property value.

What is a low doc loan?

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Low doc loans are designed for self-employed borrowers who may not have all the necessary documentation to prove their income and financial position.

Instead of providing the usual documentation, self-employed borrowers can provide alternative documentation such as BAS statements, bank statements or an accountant’s declaration.

Due to the lower documentation requirements, low doc loan interest rates are usually higher, as well as its fees. Low doc loans also have more stringent lending criteria than standard home loans.

They may also require a larger deposit, with lenders often requiring a minimum of 20% deposit for low doc loan.​

It's a small price to pay to get your foot in the door.

Can I refinance my low doc loan if my financial situation improves?

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Yes, you can refinance your self-employed loan when your financial situation becomes more stable and your business shows consistent income.

It's good way to secure a better interest rate or more favourable terms.