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Low Doc Loans are not gone!

Low Doc Loans

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The increasing credit regulation has seen many people predict the death of Low Doc loans. Independent Mortgage Broker, What If We Finance, states that despite the tighter regulation and global turmoil as a result of COVID19; Low Doc loans are a vital tool if used correctly.

A low documentation (Low Doc) loan is a mortgage that can be taken out using different income verification documentation, to those that are required full documentation (full doc or fully verified home loan) home loan. These are often used by self-employed borrowers, who may find difficulty in providing conventional proof of income.

Traditionally, borrowers that may not have completed their tax returns or have conventional proof of income available, will therefore struggle to obtain finance for many reasons. This is where Low Doc loans are a useful option.

couple goes over their property investment

Low Doc loans may still be used if we can certify income by other means, such as:

  1. Accountants’ declarations
  2. Business Activity Statements (BAS)
  3. Trading or Bank Statements

Generally, lenders also require an Australian Business Number (ABN) to be registered for GST, with a minimum ABN registration of 6 months.

Low Doc loans do not mean that income verification disappears, it is just that there are alternative ways to verify income. Lenders recognise individual circumstances are different and alternative approaches are used.

With the growing number of self-employed people in the Australian economy, Low Doc loans are gaining popularity. Low Doc loans are designed to assist borrowers who by virtue of their employment, do not have the same level of income verification as PAYG applicants or those in permanent full-time employment.

Low Doc loans are designed to assist those with existing equity (generally 20% to 40% of the property price is recommended). And those who have trouble showing evidence of regular income. Different lenders have different rules about Low Doc loans, so it is best to contact your Mortgage Broker Melbourne today.

young couple looks for a low doc loan

When applying for a Low Doc loan What If We Finance advises to look out for:

  • Low Doc loans often have extra costs and interest rates – Finance is about risk reward so the more documentation you can produce the lower the rate. In the current environment you cannot expect low doc loans at close to fully verified loan rates mortgage broker What If We Finance advises.
  • Mortgage insurance – Generally Low Doc loans, depending on the Loan to Value Ratio (LVR), may have mortgage insurance apply so there may be higher fees and charges.
  • Difference between Low Doc and Private loans – Private loans are often issued by private lenders and generally are short term (6 to 12 months), can have higher fees than Low Doc loans and need a predefined exist strategy such as selling a business, property. Conversely, Low Doc loans can have longer loan terms and do not need an exit strategy.
  • Credit file and repayment history – Your credit file and repayment history of debts will be reviewed in detail by the lenders. Like fully verified loans, there are many factors which help determine a lenders’ decision about the success of your Low Doc application. Lenders are more likely to approve applicants with a good credit rating who can demonstrate a strong asset to income ratio and whose property is perceived as easy to sell. This means lenders may not accept rural properties as security.
  • Refinancing tax debt – Low Doc loans can be used for a number of purposes but when refinancing tax debt you may need to pick the appropriate lender.

Not all lenders or mortgage brokers offer Low Doc loans, so contact What If We Finance to find out more.

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176 reviews on
Matthew B
Matthew B
2022-06-05
Looking at the reviews for What If We Finance, it comes at no surprise to see so many 5-stars. Spiro handled the mortgage part of my girlfriend and I purchasing our first home. He made himself available to us around the clock and ensured that we were across the entire process and felt as comfortable as possible. We're very fortunate to have gone about buying our first home with Sprio and we'd be more than happy to use him for future purchases and to refer on to family and friends. A big shout out to Agnes also who busily works away in the background and also does an incredible job. You guys are the best!
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hari gowtham
hari gowtham
2022-06-03
Very happy with the results from Spiro from start to finish. Spiro and his team are very knowledgeable and have a very quick turnaround time. Couldn't be more happier with the service. Definitely my go-to person for upcoming purchase.
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Gary Shekhter
Gary Shekhter
2022-06-02
Great broker and trustworthy. Honestly had seen 5 brokers and fund this wonderful guy. Who helped from start to finish fast and had our loan in no time at all. Thank you again champ you did an amazing job
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Leonie Kemp
Leonie Kemp
2022-05-29
Thank you Spiro and Agnes for helping with the purchase of my first home. I needed to arrange finance quickly and Spiro did a fantastic job letting me know the best options for me and pushing to get the pre-approval so I didn't miss out on purchasing my home. Everything went very smoothly, thanks for helping make my first property purchase straightforward.
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S S
S S
2022-05-28
Thank you Spiro and team for your help in financing the mortgage for the recent property purchase. Spiro provided timely advise, guided me on the process and was swift in processing the documents. His friendly attitude makes the process even better. Thank you once again.
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Anita Naughton
Anita Naughton
2022-05-27
As a first home buyer I had very limited knowledge on what I needed to do. I searched for a broker and What if we finance stood out due to reviews. I had my first session with Spiro and never looked back! The whole process was seamless, I felt supported and could always connect with Spiro when needed. Spiro and Agnes are experts in what they do and I would highly recommended anyone looking for finance to choose What if we finance. I will be a lifelong customer and look forward to buying our next house with their support.
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Mahmoud Al Kilzi
Mahmoud Al Kilzi
2022-05-25
Spiro & his team did a great job by getting my loan sorted in time. I would recommend them to family & friend. Great work guys much appreciated.
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Rebecca Zeeman
Rebecca Zeeman
2022-05-20
Spiro and Agnes provided great help and advocacy in getting us our home loan. We felt they were always available and were super efficient in getting it all done on time! The process was so simple and without stress thanks them both.
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Irish Azcuna
Irish Azcuna
2022-05-09
I can’t thank Spiro and Agnes enough for making my first home purchase so efficient, stress-free and seamless! If I could give more than 5 stars I would. As a first home buyer applying for one or the government’s schemes, my situation would have been so complicated that I never imagined being able to complete the process in such a short time. Spiro’s in-depth knowledge, invaluable and always-available support, and genuine willingness to help get me the right mortgage for my situation, made everything possible. His pragmatic advice even helped me decide on the right property for us, which would help us achieve our long-term goals. I highly recommend Spiro and his team. We will definitely engage their service again for our next property. They are the best!
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Renee Briggs
Renee Briggs
2022-05-02
Spiro is reliable, has your best interest as his top priority and is fast to get great results. We wouldn't ask anyone else for their professional opinion- Spiro is the best in the business.
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