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Are you self-employed?

Oktay Sengoz

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25/10/2022

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1 min read

When applying for a home loan, a lender must be satisfied that you can afford the loan you are applying for. Usually, they will review payslips, tax returns and other income to determine how much you can afford if you are employed by somebody else.

Lenders assess self-employed income a little different, as It’s not as consistent as someone receiving a regular salary or wages. Self-employed income is usually not consistent, as one year varies from the other.

Lenders will assess your last 2 years of income tax returns to establish an acceptable income that can be used to calculate how much you can afford, but what if you haven’t done your tax returns?

Here are 3 ways you can obtain a loan being self-employed

Full doc

This means providing your complete set of tax returns for the past 2 years, together with any other information that may be required, i.e., BAS statements, transaction statements etc.

Full doc, but not with all information

Some lender will accept the income started on your individual tax return and notice of assessment if no other income needs to be used. This means if you have companies or other entities that you operate, then you don't need to provide information about how they are financially operating.

Lo doc

A Lo doc loan is only offered by certain lenders and basically, as the name suggests, allows you to confirm your income with minimal information only. Occasionally, a declaration from yourself and the accountant is enough to obtain a Lo Doc loan.

Talk to us today if you are self-employed to see how we can help you obtain a loan.

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