Self Employed

Home Loan for Self Employed

In the past, if you had an ABN number registered over two years and a good deposit of 20 per cent, you would get the loan easily by completing a self-certified income declaration

However, this is a thing of the past and now alternative documents such as a 12-month BAS statement, a letter from your accountant confirming your income, or a three month trading statement showing good turnover, are required

Low-doc applicants who are now considered risky because of the simple fact that the banks are unable to see their full financial circumstances.

Banks will now apply a number of other protocols to ensure a low-doc loan applicant is a safe bet

The most basic way is taking a good deposit, and this is typically at least 20 per cent of the purchase price of the property and 5 per cent of associated costs such as stamp duty.

Alternatively, they will require Lenders Mortgage Insurance if the borrowing is more than 60 per cent, in comparison to full documentation clients for who it is applied on a more than 80 per cent borrowing.

Higher interest rates are another method, although this will depend on the lender and the loan-to-value ratio

Borrowers who were self-employed and had difficulty showing proof of their income or had a fluctuating income, were most affected.

Lending policies to self-employed applicants are becoming more and more difficult

Please speak to us to find out which of the lenders will qualify you based on your individual situation, and which lender will provide you a solution most tailored to your individual circumstances

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