How do I find the best home loan for my situation?
Just as you would do if you were not self-employed and were shopping for a home loan, you look around at the different loan solutions provided by various lenders for self-employed people. Look for reputable and approachable lending specialists who have been around a long time, such as Mortgage House. They are an award-winning lender who also happen to be one of Australia’s largest independently owned, non-bank loan specialist who have been helping people buy homes since 1986.
If I don’t have regular payslips, what documents do I need?
Without payslips your loan provider will allow you to go through a self-verification process, described as a ‘low doc loan.’ This means, you will provide them with less documentation than a regular home loan requires, but it will include financial documentation such as your personal and business tax returns for the past two to three years, your financial statements for the past two to three years and proof of your ability to raise a 20 per cent deposit of the required loan amount.
What type of home loans are available to me?
Within the realm of a low doc loan, Mortgage House offer self-employed people a great range of loan options:
- Owner-Occupier loans, where you buy or build, but you will live in the property.
- Investment loans, where you are buying or building a residential investment property.
- Variable Rate loans, where the interest rate increases or decreases over the life of the loan.
- Fixed Rate loans, which are set at a fixed interest rate, usually for 1-5 years and then negotiated for another fixed term or changed to the variable rate.
- Toggle Offset loans, where you can toggle between the fixed and variable rates to maximise your interest savings.
- Split loans, which have no restrictions on what portion is fixed and variable.
- Construction loans, where you can make staged payments to your builder and interest is charged only on the amount paid out, not the full amount.
How do I know how much I could borrow?
Many lending providers will have a borrowing calculator on their website. Mortgage House like to make borrowing as easy as possible, so they have a number of borrowing calculators, such as their ‘How Much Can I Borrow?’ calculator and the all-important ‘Mortgage Repayment’ calculator so you can see how much your monthly or fortnightly repayments will be. To help with the whole process they also offer a ‘Budget Planner’ calculator and a ‘Stamp Duty’ calculator because those extra costs need to be taken into account.
What are the benefits of a low doc loan?
There is less paperwork than with other loans. They take less time to process and although the initial interest rate may be a little higher, they offer an interest rate discount after a period of successful repayments.
As you can see, obtaining a home loan when you are self-employed is certainly achievable and easier than you thought!