Loans for self-employed borrowers

Two options for self-employed borrowers

Sometimes it’s difficult for self-employed people to show a regular income. Also the tax income declared by self-employed people is often reduced as accountants try to maximise the deductions the business owner is entitled to. There are two options as indicated below:


1. Low Doc loans and you cannot show a regular income

If your income is irregular or seasonal or there are swings in your income from year to year, then you may quality for a Low Doc loan. In this instance you’ll be required to complete and sign a declaration indicating your income and stating that you will be able to service the loan without undue hardship.

The maximum that you’ll be able to borrow will be 80% of the purchase price (or value of your home), so, if you’re buying a home you’ll have to have a deposit of 20% plus all purchase costs.

Many lenders put a premium on the interest rate for Low Doc loans, which reflects the lender’s risk as they have not seen your income details.


2. Self-employed and you can show a regular income

If you’re self employed and can show your income, then you won’t need a Low Doc loan and you’ll generally be able to borrow to 90% or 95% of the purchase price depending on the lender and loan product.

Get expert advice for a self-employed loan
Because of the complexities of getting a home loan if you’re self-employed, it’s advisable to contact us for advice. An Aurora Finance Group finance professional will know which lender is most suitable for your situation and circumstance.