Low-Doc Home Loan:
This type of loan product is designed for applicants that are self employed and have been self employed for at least 2 years prior to applying for a low-doc home loan.
Basically designed for the self-employed who may not have all their documentation up to date such as tax returns or other financial statements that banks require with traditional products.
A self certification income declaration needs to be signed by the applicant. By signing the declaration the applicant confirms that the loan repayments are affordable.
Borrowing under a Low-Doc loan facility is usually limited to 80% of the property value offered. The property value may also be limited to $750,000.
Lenders Mortgage Insurance may also apply when borrowing at a ratio between 60% and 80% of the property value.
This type of loan facility is based on the variable interest rate and usually charged at standard variable market rate.
The Low-Doc home loan offers a variety of features such as:
- A choice of principle and interest or Interest Only repayment option
- You can also make additional loan repayments without incurring a penalty
- Direct salary crediting into your loan account to help reduce interest
- You may also have a re-draw facility, accessing your payments made in advance from any ATM network.
A few banks are now offering the Low-Doc home loan.
