Finance for Self employed

Hi,
Has anyone came across any good lenders for self employed businesses (low Doc) that lend up to 90% lvr and don't have so much red tape like a traditional bank?

 

Often times the answer i get is "we don't count that as income" be it CG from sale, imputation credits or other sources.

So are there No or low doc loans taking account of only rental income and a declaration for purchase with 30-40% deposit available?

 

Capital gains isn't ongoing income, so it raises the question of how you service the loan after the cash runs out. You might as well argue that you've got savings to cover the repayments (but if you had enough savings, you wouldn't need the loan).

I'll grant you the imputation credits argument, but the lenders argument is that this form of income is not guaranteed in the future. Many lenders treat it as variable income and only use a portion of it (somewhat similar to rental income).

The purpose of lo doc loans is for when it's difficult to verify income, which isn't a problem for rental income. You can easily verify it from agent statements, bank statements or tax returns. The problem with rental income is that it likely isn't enough to service the loan, so a lo doc loan doesn't solve any problem for this scenario.

 

Depending on the lender too they may include it, exclude it or partially include some of it.

 

The rent receieved with a 30% deposit no longer counts?
In QLD you can buy a house for 500k earning 530wk. ~20k net interest 350k @ 4% is 24k.
Then there's depreciation.

One of the reasons I asked is that plenty people in other threads , and noobs seem to think that getting finance is not a problem.

Actually it solves the problem of getting a loan when you are self employed and only need to work if you have extra expenses.
If a plumber only works 2 days a week but would do a third day to pay off an IP is that not a solution?

If CG brings the tax rate up to 42%, why go and work for only 58% of normal pay?
How much work would you do for 42% less pay?

 

Still easily verified if it's all done above board and documented. Some lenders will even consider the interest on a savings account if it can be verified.

The law doesn't see it that way. In their calculations, lenders can only rely on what you're actually earning. By declaring a three day income when you're actually only earning two, lenders might see this as lying on the applicaton.


I don't disagree with the ideals you've put forward. I can point to plenty of lending policies that lenders could easily justify some wriggle room (living expenses is a huge one). Don't get me started on how over regulated the entire financial services environment is. I'm definitely in touch with the reality of doing a lot more work for significantly less pay!

 

Some brokers dont know what the F&^% they are doing if you must know Lindsay_W
....

 

Suggest trying one from this website then.
Otherwise you'll be asking the same thing for another 6 months

 

Or just don't reply

 

Your questions are too vague for any broker here to answer accurately, so you would benefit from talking to an actual broker and showing them the supporting data you have so they can advise on it.
Plenty of good lenders out there for lo-doc/self employed income but whether or not you would qualify with them is another question altogether.