Low doc home loans are a great way to get the home of your dreams and to enjoy lower mortgage rates. However, not every lender offers them and there is more to finding a good loan than just a low doc fee. Some lenders may have standalone low doc home loans which are only available to those who qualify for a low doc mortgage or fulfill the other criteria for such a loan. Other lenders may have a low doc choice on their standard whole home loan packages.
For those just starting out and with a tight budget, it can be a good option to go with the first low doc home loans you find because these will come with the lowest repayments. The amount will be much lower than the standard rate and it is important to remember that low repayments are not good for you. They leave you with large monthly repayments over the term of the loan and this can lead to a lot of debt if the repayments stretch out for too long. This means that even if you think that you are getting a bargain you could be in for an unpleasant surprise if the repayments are too high.
If you have a job and an income then these low doc home loans could help you to increase your monthly finances. This is because your repayments are far lower than with standard mortgages and also you do not need to have proof of your income. As long as you have a job and a monthly income, then any lenders can offer you a home specialist loan and you would be well advised to take advantage of this. The key to getting this type of loan is to prove to the lenders that your income is sufficient to make your repayments on time every month. If this was proven then this would be the deciding factor on whether the provider would consider offering you a home loan or not.
There are two ways of proving your eligibility criteria, you can either prove your employment or your financial situation will be reviewed by a specialist advisor. You will be able to choose between the two options. When you apply for low doc home loans you will be asked if your weekly or monthly earnings are over a specified sum. The sum is normally between forty and sixty dollars per week. In order to meet the income criteria you must also have had at least one week of payments in arrears or bankruptcy, and the repayment period must have passed. You will find that a majority of lenders now allow borrowers to take up to twelve months for their mortgages to come to an end, after this period they will be considered to be ‘exempt’.
The next way that you are able to get low doc home loans is to provide details relating to your bank accounts and savings. Some banks and building societies will ask you for this information, others will not. You will also find that the majority of lenders now ask for bank statements from every bank in your financial situation. It is important to note that some banks may still ask for these documents and if you have not received any replies from them in the past six months it is recommended you try again.
You will also need to provide details about your expenses, whether you have regular income or not and whether you are self-employed or not. If you are self-employed, or have other form of income, you will need to tell the lenders if this is also included in your low doc loans application. This information is used to calculate your income and expenses and for the purpose of determining whether you are eligible to receive the loan or not.
One thing you need to remember when looking for low doc home loans is that the interest rates that have been quoted to you are usually quoted on a monthly basis. This means that if your application is approved you will only receive a single monthly payment, and this will be the interest rate. If you happen to change the lender and take a fixed rate home loan, instead of paying variable rate home loan interest you would also then have to pay a different amount of interest every month. For example, if you were to take a fixed rate home loan, and then changed to a variable rate home loan, you would then have to pay the variable rate interest each month until the fixed rate was paid off. This means that the low doc home loans you receive will cost you more money.
In order to qualify for low doc home loans, you must be at least 18 years old and an Australian citizen. The applicant must also have a full Australian Work Visa. To check your credit history, a simple credit search online can find out all your records. Once you have checked your credit history and are satisfied with it you will be able to submit an online application for your low doc home loans. The whole process takes only around 7 days, and in some cases your application can be approved in just a few minutes.