Title:
The Low Down on Low- Doc Loans
Subtitle:
Low-doc loans were shunned following the global financial crisis but with more people becoming self-employed, they are returning to favour.
Body:
Low-doc loans were shunned following the global financial crisis but with more people becoming self-employed, they are returning to favour.
Low-doc – or low-documentation - loans are designed for borrowers, generally the self-employed, who have difficulty getting the required paperwork together to apply for a more traditional loan.
The beauty of these loans is that they have allowed thousands of borrowers to take out a mortgage, who otherwise wouldn’t have been able to because of their fluctuating income.
Candidates for these loans still need to satisfy certain criteria. Previously, just a statement confirming a borrower’s income was adequate but more emphasis is now placed on income verification.
If self-employed, lenders will look for consistency of income to ensure minimum repayment requirements can be met. Often a letter from an accountant will be required, or a bank statement that outlines income and expenses. Some mortgage insurers may want to see a borrower’s BAS history before they insure for a low-doc loan.
Since the GFC, there are some lenders who are reluctant to lend more than 60 per cent of the value of the property so shop around as this does vary. Some low-doc loans also attract a higher interest rate but this isn’t always the case. And these days, low-doc loans generally offer all the features of traditional loans, such as redraw, offset accounts, and interest-only options.
Borrowers considering taking out a low-doc loan should read the fine print and make sure they are aware of all terms and conditions. And if unsure about any of the conditions, seek advice from a qualified adviser or accountant.
Source:
About Resi Mortgage Corporation:
Resi is an award winning, market leading non-bank lender specialising in; home loans, commercial loans, investment loans and financial services. Resi is an Australian owned and operated lender with over 25 years’ experience dedicated to providing Australian’s with low cost, innovative product s to help them own their dream. Resi provides a full service operation that includes, local lending specialists, and an Australian based customer service team.
ContactResi Mortgage Corporation:
Press Contact’s full name: Ricki Hudson
Press Contact's email:
Press Contact's phone number+61 2 8204 5047
Press Contact's address Level 3, 458 Wattle Street, Ultimo, NSW 2007
Keywords:
mortgages, interest rates, debt, Resi, Australia
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