How to help self-employed clients find the right loan
When it comes to property ownership, many Australians who are self employed or own small businesses might not be able to provide all the financial documentation that’s needed when applying for a loan.
Lenders need proof of income such as payslips and group certificates from borrowers and this process can be somewhat challenging for self-employed people because they won’t have the paperwork that’s traditionally needed.
The good news is that there are options out there to help all Australians buy a property. For the self-employed, the most common product is a low documentation (low doc) loan.
Low doc loans are more flexible in the application process, assessing borrowers on less financial documentation. These are particularly useful for Australians who are their own boss and don’t have the paperwork that is usually needed.
On low doc loans, interest rates are often higher than traditional home loan products because the application process is simplified.
To apply for a low doc loan, self-employed Australians usually need to supply:
- Recent bank statements
- 12 months of business activity statements
- An Australian Company Number/Australian Business Number
- Have a clean credit rating
As with all clients, those who own their own business all have a different set of circumstances. There’s no one loan that fits all, so if you’re working with self-employed clients, a mortgage broker can help them with their home loan options to ensure the application process runs smoothly and they secure the right loan.