How to Get Benefit from a Low Document Home Loans

Author : Rajan Khattak | Published On : 21 Sep 2021

When you work for yourself, many perks come with it. Unfortunately, when applying for a home loan, the banks and lenders see being your own boss as an issue to provide funding.  

But why is this matter? A salaried employee might have a steady income, but they’re less likely to experience the cash flow volatility as small business owners and freelancers. By being proactive and accessing the guidance of a home loan finance advisor, self-employed applicants can still enjoy successful mortgages such as low doc home loan applications with the minimal hassle of providing documents.  

What is Low Doc Home Loans?  

Low doc or Low documentation loans are a type of home loan that can benefit people who don’t have access to the information banks and lenders often require. This could include small business owners, contractors, self-employed or freelancers whose income may be irregular but still stable enough to make repayments.   

What are the essential features of a Low-doc Home Loan?  

In a low doc loan, you can still access all the great features included in regular loans. here are the main features of a mortgage that include:  

1) Extra repayment options: As the term sounds, this feature let you as a borrower make additional repayments without being penalised with a fee.  

2) Offset: A low doc mortgage has an offset feature that allows you to save money using a non-interest-bearing bank account. The interest is calculated on the difference between your home loan and this separate bank account, allowing for lower monthly payments because of how much less you pay in interest over time.  

3) Relocation: An individual can’t stay at one home for the 30-year life of a mortgage; the relocation feature can help you get out of your existing loan into a new home faster. A person planning to relocate should choose this option so that things go smoothly on the mortgage process later on.  

The Benefits of Choosing Low Doc Home Loan  

There are several benefits of choosing low doc mortgages, which is excellent news for individuals with a history of not being able to secure regular home loans. Some advantages include:  

  • Low Documentation: Since you don’t have to worry about things like income tax returns, business details, pay stubs and employment verification forms for the borrower, there are fewer efforts to secure this type of loan.  

  • Ease of Application: Since a low-doc application doesn’t involve extra documents like a full doc home loan, it takes less time to get approval from the lender.  

  • Low-interest rates: When you first get a loan, interest rates tend to be higher. But once lenders observe that you are making payments on time and in full for some time, they may reduce your rate as an incentive to keep lending money through their bank.  

How to know the Borrowing Amount from Low Doc Loans  

There are many different services that can help you narrow down your property search and budget for a home loan. One of these is using a low doc home loan calculator, which indicates what you may be able to borrow by entering information such as the interest rate amount and borrowing amount into an online calculator tool.  

Even if this low doc loan calculator doesn’t help up to your expectation, then contact the top home loan broker to help you find suitable options. Contact Rohit Khatak, one of the leading Home Loan Brokers in Rozelle, that help to find the best loan per your financial condition.  

If you are thinking of investing in a home loan, be sure to consult Your Finance Adviser. Our team of highly skilled finance advisers has years of experience providing low doc home loan advice and guidance to people across Australia, so we can help you make the right decision for your personal needs. We offer all types of online tools including a stamp duty calculator, low doc loan calculator, loan repayment calculator, and more. If you would like assistance with any financial decisions or have questions about our services, please contact us today!