Being self employed has many benefits but traditionally borrowing money can prove to be difficult due to a lack of financial information at the time of the application.

Generally financial institutions like to see the last 3 years of a self employed applicant’s financials. They approve loans based on a number of criteria one of them being your ability to repay a loan by looking at your net profit after expenses. They tend to average your income out over a 3 year period.

Some self employed in the past have had their applications declined due to fluctuating income years and uneven cash flow on paper, and yet they know full well they can afford the loan. But due to “The Bank Manager” having to follow strict servicing criteria and not being able to tick the provided box from head office you the client walk away unsatisfied and without a solution.

Those days have gone!

Low doc loans have been in the market place for sometime now. There are not too many differences between a fully documented loan (ie provide your company tax returns and other supporting information) and a low doc loan. The main differences tend to be based on how much you can borrow ie the loan size, the loan to value ratio and interest rates.

So what is a low doc loan?

•	A low doc loan means just that it’s low on the documentation!
•	You don’t need to provide tax returns and financial statements
•	You don’t need to prove rental income if buying a rental
•	If you are borrowing 60% or less you sign a statutory declaration stating that you are aware of the loan repayments, how much you earn and that you can afford the loan.
•	If you are borrowing 60% or more then the above applies but you will also be required with most of the major banks to provide 3 months bank statements so they can better understand the cash flow coming and going through the business account.
•	If borrowing more than 60% of the value of the property a lenders mortgage insurance fee may apply which is charged by the financial institution. (The same charge is applied to full documentation loans when borrowing more than 80%).

Would I qualify?

•	Have you have been self employed for at least 2 years (and under in some circumstances see Non Conforming)?
•	Have a clear credit rating?
•	Kept up with your mortgage repayments if refinancing?

If you have answered yes to the majority of the above questions then the chances are likely that you would qualify.

You may also qualify if you have answered no please see our Non Conforming section.

We are professional NZMBA accredited mortgage brokers. It is our duty to understand the market and educate you on available options that best suit your requirements. Many of the consultants here at World Wise have been self employed and understand the “juggling act” it sometimes takes to keep your head above water and the relief it can bring to have a no obligation discussion with a professional that can assist with

•	Freeing up equity for your business
•	Buying investment properties in complex trust structures without having to provide all the paper work
•	Giving you back your precious time by organising and taking away another project you just can’t seem to find the time for but is absolutely necessary

If you would like more information on low doc loans please complete the inquiry form and one of our specialist finance consultants will contact you TODAY!

Alternatively call us on Phone/Fax 09 437 1092 to arrange an appointment to discuss your scenario with us in person.