Low doc loans are lifesavers for people who aren’t able to easily prove their income to a traditional lender. They make it possible for the self employed to get on the property ladder the same as a regular employee or established business owner. For Red Rock Mortgages franchise owners, it’s a chance to help entrepreneurial Australians achieve the homeownership dream.
But how quickly can these low doc loans be approved?
What is a low doc loan?
A low doc loan is a mortgage designed for people who are self-employed or have recently started their own business, and don’t have any of the usual documents that lenders need to see. The income is often there, but proving it can be difficult if you don’t have months of payslips or tax returns from multiple years. A low doc loan doesn’t require the same kinds of documentation that normal loans do. An accountant’s letter, a business activity statement or a business banking statement can usually be enough proof of income to put in an application for a low doc loan, provided you have the income and deposit.
How quickly can a low doc loan be processed?
The short answer is, it depends. Generally speaking, most low doc loans take somewhere between four to six weeks to be finally settled. That said, there are a number of factors that can make the whole process run faster or slower:
- The complexity of your financial situation,
- The speed with which you return relevant documents,
- Whether your documents like ID and financial statements are up-to-date and ready,
- The speed of the lender themselves.
You obviously can’t control how the lender does their work, so make sure you’re organised on your end if you want everything to go as quickly and smoothly as possible.
What makes Red Rock different?
Traditional lenders assess a loan application using things like credit scores, payslips or tax returns for a business. In other words, mainstream lenders have traditional requirements, which make them unaccommodating for those who have income (like recent small business owners) but few of the documents to prove it.
At Red Rock, we don’t use credit scoring – instead, we manually review every application using a broader credit policy. This allows us take into account the individual circumstances of the borrower and take in the bigger picture around their financial situation, rather than simply going off a context-free number like a credit score.
Our franchise opportunities give you the chance to buy in to the Red Rock family. To learn more about what’s possible with us, apply for a free information pack today.