Low Doc Perth Home Loans
Low Doc home loan is a flexible solution which offers a simple application process for those that have difficulty providing documentation about their regular income. Self employed, seasonal workers or contract workers fall under this category.
Most home loan lenders offer a low doc or no doc home loan product, but with varying interest rates, so it pays to look around and compare rates. With a low doc home loan, ensure that you know what your mortgage payments will be, as the interest rate can often be high with this type of home loan product. You can use a mortgage calculator or talk to your mortgage broker for more about repayments. These loans are traditionally aimed at self-employed borrowers who may have difficulty showing regular income, and present more risk for the lender, therefore the risk is usually built in to the mortgage at cost to the borrower. The loan can be a fixed rate or variable rate mortgage, and can be used to borrow, up to 80% of the property. The lender may charge lenders insurance as well.
A low-doc loan still requires some evidence of income such as bank statements or tax returns etc, while a no-doc home loan works by self certification. A statement signed by you declaring your income is accepted by the lender. The loan itself operates the same way, but you are able to gain approval without as much documentation. Borrowers applying for a low-doc or no-doc home loan will need to have a clean credit history
Consider the following facts about low doc loans:
- higher interest rate is usually applied, although the more financial documentation you can produce, the lower the rate often is
- additional and inflated fees and charges may apply
- mortgage insurance may be payable
- higher deposit is usually required (often up to 20% of the property value needs to be provided by the purchaser)
- added security could be required, such as a car or other investments
- a shorter loan period may apply. Some loans require the applicant to refinance after a set period of time, sometimes as short as 1 year.
These loans are best suited to borrowers who are unable to provide full financial documentation to obtain a regular home loan.
If you feel that you need a low doc home loan, talk to a local mortgage broker first and find out more about this home loan. You can call on
or submit your details on line.