Low Doc Home Loans

KEY TAKEAWAYS: A low doc loan is a mortgage that requires less documentation than standard home loans and can best suit self-employed individuals. Working closely with a professional mortgage broker ensures your documents are right to go before making an application and that you get access to the right lenders.

Table Of Contents

What is a low doc home loan?

A low doc home loan is a mortgage that requires less documentation than standard home loans.

This loan option can help you buy your dream property if you are self-employed, freelancer or casually employed or someone who doesn’t meet the requirements for standard home loan applications.

Who is eligible for a low doc home loan?

This type of home loan is ideal for borrowers who have both assets and income and are not able to provide the usual paperwork, such as tax returns.

Low doc loans can also be used in cases where tax returns are not yet completed or are out of date. In these situations, alternative documentation (such as BAS statements), is required to better reflect current conditions.

Low doc home loans can be applied for by self-employed individuals, freelancers and investors who do not have a regular job paying PAYG taxes.

A low doc loan allows for a lot of flexibility. A low doc loan is ideal for contractors, freelancers, and consultants.

Not sure yet if you are eligible for a low doc loan? Professional Lending Solutions can help you discover if you qualify for one. Get in touch with us to find out if a low doc loan is right for you.

How much can I borrow?

With our lenders, you can:

  • Loan up to 90% of the property’s value (higher interest rates may apply).
  • Borrow up to 88% of the property value and enjoy competitive interest rates (a slight risk fee may apply).
  • Get up to 60% on your property value by taking out standard home loans at the best rates.
  •  by taking out standard home loans at the best rates.

Will I get approved for a low doc loan?

Lenders will still ask for some proof of income, although not as many compared to regular home loans. Here’s what lenders typically ask of you when you apply for a low doc loan:

  • To prove your income, you will need to provide alternative documents
  • A majority of lenders require that you have a valid ABN for at least 2 years. However, some lenders are willing to accept you if you have held an ABN for less time.
  • Some lenders will consider you even if you have less than excellent credit history.

Most common reasons that lenders decline low doc loans:

  • Income is not high enough or lacks sufficient documentation to cover the loan.

  • A poor credit history.

  • Failure to pass the lender’s credit score.

  • Where the security property is located.

  • A property that is not suited for a low doc loan.

Choosing the low doc loan that suits your needs

What should I look out for when looking for a low doc loan?

As low doc loans carry a higher risk for financial institutions, they will place greater restrictions on this type of home loan.

Here are some factors for you to be aware of when considering a low doc loan:

  • Higher interest rates. This all depends on the lender as well as the type of supporting documentation and verification you can provide. Some lenders offer lower rates than full documentation home loans.
  • A higher deposit is usually required. However, some lenders may only require 20%.
  • LMI or Lenders Mortgage Insurance is generally applicable if you borrow more than 60% of the Loan-to-Value Ratio (LVR).

Be guided with these restrictions by speaking to one of our expert mortgage brokers. Call our experts mortgage brokers in low doc loans on 07 5597 6049 today.

How can I get approved for a mortgage with a low doc?

Finding approval for your loan isn’t as easy as it was in the past. This three-step process is how we as your trusted mortgage broker will use to assist you in finding a lender:
  1. Identify what you need the loan for, collect which documents are available to you, and find which lenders are able to help you.
  2. Select the lender offering the lowest interest rate, fees and LMI premium and loan features that are most important to you.
  3. Make sure to present your application in a manner that is favourable to the lender.
Pro-tip: Lenders concentrate only on the documents that you provide to complete their assessment of your loan application. To avoid diverting to an unfavourable decision, only provide the documents that they ask of you and nothing else. They can always ask for further documentation later if they need it for their application process. Which low doc loan lenders could I trust? Certain low doc lenders might be better than others for your personal low doc home loan needs.
  • Other documents may be required by lenders to prove your income.
  • Low-interest rates are not always the best option, as some lenders may have hidden charges.
  • You should also consider the LMI fee and application fees lenders might charge.
We work hard to recommend a lender which allows you to refinance your loan to a full doc loan after you have completed all of your tax returns. Get matched with the right low doc lender by our highly experienced mortgage brokers.

What are the requirements for a low doc home loan?

What documents do you need to obtain a low doc loan for your home?

To be eligible for a low doc loan, you will need to supply supporting documents to prove your income. Each lender has its own requirements and will accept different types of documentation to prove your income.

In general, these are the following documents that can be used as proof of income:

  • 12 months of BAS statements with a high turnover.

  • An accountant’s letter stating that they have verified your income. Lenders may sometimes call the accountant to confirm the details on the letter.

  • Business bank statements that show high turnover.

  • Interim financial statements.

The National Consumer Credit Protection Act requires that lenders verify income before they can approve your mortgage.

If you are not able to provide any of these documents, it may be likely that the lender will reject your application. If you are in this position, please reach out to us for a FREE chat and we can advise you of your options.

Length for ABN / GST registration

Most lenders require an ABN that has been GST registered for two years. However, this can vary from lender to lender.

We have ensured to include in our panel of lenders one who will accept someone with an ABN even for one day. This option is most often used for start-up businesses.

Age- and occupation-related income

Lenders will decide if your declared income makes sense. For example, for an 18-year-old apprentice to declare an income of $200,000 is significantly higher than the median, increasing its chances for an application to be questioned or declined.

Your income and occupation are subject to the banks’ responsibility to uphold lending laws.

The ratio between assets and income

Borrowers need to have a good income-to-asset ratio. A net asset position that is two times your annual gross earnings is a ratio that lenders prefer.

For instance, if you earn $100,000 annually, you are expected to have $200,000 worth of net assets.

This policy is more stringent for younger applicants than it is for older borrowers. Because of this, we help young people to apply for a loan with a lender who does not have this policy.

Security property

Lenders prefer prime security properties that are located in high-demand areas like major cities and regional centres. Some lenders won’t take properties that they deem are unusual, difficult to sell, or in disrepair.

Total exposure

Lenders will prefer and classify borrowers with lower total debts than $1,000,000 to be low doc.

A few lenders are willing to lend up to $2.5m per borrower group. (A group is classified as the maximum combined total borrowings of married partners, for example).

Our lenders can assist investors in borrowing more than $2.5m. But you need to have substantial assets and only borrow a small portion of the property’s worth.

Equity releases

Lenders require documentation to prove how funds are being used if money is sent directly to the borrower.

Lenders may be concerned that the borrower doesn’t have an income and might believe that the borrower is using the money to pay the interest of other loans or to put down a deposit for further property purchases.


Some lenders may not refinance low document home loans and investment loans but allow you to purchase property with a low documentation loan.

Mortgages that are refinanced have been shown to be riskier than loans used to purchase a property. This can lead to many people being caught unaware if they buy vacant land, then refinance later when they build.

We specialise in low doc mortgage loans and can assess your needs and match you with the right lender. Enquire online to talk to one of our expert mortgage brokers.

Why use a mortgage broker for a low doc home loan?

With the vast number of lenders and varied offers out there, it is crucial that you speak with an expert in low doc home loans to get matched with the right lender and to find the best deal for you. Low doc loans now offer professional packages and basic loan discounts, much like full doc loans, and navigating all your options could overwhelm you, or worse, derail your chances of getting approved.

There are also significant differences between lenders when it comes to LMI premiums and application fees. Although this information is not publicly available to lenders, we as mortgage brokers are aware of it.

Our lines (and doors) are always open to serve individuals like you who may be wondering if a low doc loan is their best option. Get in touch with Professional Lending Solutions by booking your preferred time or by calling us at 07 5597 6049.

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