Applying for a low doc home loan comes with its own set of criteria that will need to be met. Generally speaking, there are three requirements that any borrower has to meet for their lender to even consider granting them a mortgage.
If you’re in the market for a self-employed home loan, then make sure you have all these documents to hand to increase your chances of being accepted.
1. Self-certify your income
When you’re self-employed, you won’t be able to follow the usual channels of having your boss confirm your income. As a result, this is something you will have to do yourself.
Your lender will obviously need reassurance that you’ll be able to make repayments on your loan, which is why this stage of the process is so important. On the form, you’ll be expected to declare your personal income from your work, as well as any other payments you might receive.
Once this has been stated, there will be a further declaration that states various other financial terms that you agree to. This is a legally binding document, so don’t agree to anything that you might not ultimately be able to fulfill.
2. Clarify your employment status
It will also be necessary to confirm your self-employment status, which can be achieved by providing your Australian Business Number. It’s also a good idea to have a letter from your accountant explaining that you work for yourself.
This will prove to your potential lender that you’re eligible for a low doc home loan and not for any other type of mortgage product.
3. Show your credit history
A clean credit history will certainly work in your favour when applying for self-employed home loans. It demonstrates that you’re reliable at making loan repayments and have sufficient income to satisfy them.
Your credit record will show evidence of any other products you’ve taken out, so it’s worth investing some time in making it as clean as possible.