image description

Low Doc Home Loans

Find a better rate on a low doc loan. Contact us for a free consultation to find out how.



Low Doc Home Loans


What is a Low Doc Loan?

A low doc loan, short for 'low documentation' loan, is a loan designed to be used by people who don't meet the regular qualification requirements for a conventional home loan to purchase or refinance a residential property.
Just as in regular loan applications, a low doc loan requires that the applicant submit their request in written form. Whilst previously many of these types of loans used to have the option to not submit proof of income, all lenders now require some form of proof of income.

Can I apply for a low doc loan?

Because low doc loans are devised to be used the people that have a level of equity or deposit saved, but are facing trouble in providing evidence of regular income. This usually works for the self employed. Low doc loans may also be available to individuals with a bad credit history.
Unfortunately, in some cases low doc loans are abused by individuals who deliberately erase their income to avoid tax returns. This is considered an offence and if the person is caught, he/she may be forced to pay penalties and fines that far outweigh any benefits they may have hoped for by violating the law.

What's the reason for taking a low doc loan?

If you happen to fall into the categories mentioned above and would like to purchase/refinance a house, townhouse, land or apartment, a low doc loan could be an alternative option for obtaining the required level of financing you need. Make sure that you weigh the pros and cons before making the final major financial decision. This will help you determine if you can afford the repayments. You may also be advised to take out mortgage insurance, which may add more to the total cost.
Usually 80% of the property value will be covered by the low doc loan. This can be increased if you provide more legal, verified financial documentation.

Types of low doc loans

There are 2 types of low doc loans. These are: account statement and asset lend.Both have eligibility requirements that can vary significantly. BadCreditHomeLoans.com.au only looks at the account statement type. This is discussed briefly below.

Account Statement
In this case, you are to give concrete income evidence which may include a signed letter from your accountant. The interest rates are generally in accordance with standard home loans.

Should I be careful about anything?

There are some conditions and extra costs you should try to avoid. For example, higher interest rates, extra and higher fees, and charges along with mandatory mortgage insurance. Sometimes a higher level of existing equity or deposit is asked for. In some cases 20% is not uncommon.

Get a free low doc home loan quote

If you would like to discuss obtaining a low doc home loan or to discuss your other options please call us on 1300 724 342 or fill out the enquiry form in the left hand menu of this page.