Self-employed individuals often look at low doc home loans to get their feet on the property ladder. It’s not as uncommon as you think as mortgage lenders tighten restrictions. Fortunately, there are things you can do to improve your chances of getting a low documentation loan. For instance, having good financial records sets you in good stead. Of course, there are a few other things you can do to increase your chance of approval.
So, how can you improve your chances of getting a low documentation home loan?
Good Credit Goes a Long Way
One very simple but important way to help improve your chances of getting a low documentation loan is by having good credit. Now, a lot of people don’t know lenders take a very close look at your credit history and score when applying for a loan. The reason is so they can assess your application in terms of risk. For instance, someone who defaults on every loan they’ve had in the past ten years is not a viable risk for a low doc home loan.
On the other hand, someone who has a good credit record and has never defaulted before looks more favourably. So, while you don’t need perfect credit, it does go a long way. If you can, clean up your credit before applying for a loan. It might improve your chances substantially. To find out more about eligibility, check out lowdocloansco.com.au.
Your Financial Status Impacts Your Ability to Get Low Doc Home Loans
There is a misconception that anyone can get a low doc home loan, but that’s not entirely true. For instance, casual workers who earn very little and don’t have any savings in the bank (and cannot support themselves), are unlikely to be approved. On the other hand, someone who has a small business (and supports themselves) stands a better chance.
In truth, your employment status and financial situation impact your chances of obtaining a loan. So, if you are self-employed and have substantial money in the bank for deposits and monthly payments, then you have every chance of getting a loan. To find out more about how much you should have in the bank, check out lowdocloansco.com.au.
Find Out Where You Stand by Talking to a Lender
It’s tempting to rush fate and apply for low doc home loans before you have your ducks in a row. Unfortunately, you could be in for a fall. For instance, you apply for a loan but don’t have any savings. Rejection is likely. So, before you do all that, find out where you stand. Click here to read about What are the Differences Between a Standard Bank Loan and a Low Doc Loan?
Talking to a lender can give you an idea of where you need to be before your loan application can be approved. Remember, every lender has criteria that must be met (which can vary significantly) and it’s crucial you know what they are. It gives you a better chance of getting a low doc home loan.
Find the Right Loan for Your Needs
Improving your chances of obtaining a low documentation loan can be done by having good credit, a stable financial (and employment) situation, and meeting the loan’s criteria. It’s not impossible to get approval and it can help you get on the property ladder. You need to be able to support yourself and have sufficient funds for a loan application to be successful. Low doc home loans can be great and useful for you too. Visit https://moneysmart.gov.au/home-loans to find the best home loan and pay it off faster.