The low-down on 'Low Doc' home loans

Self-employed tradie working under a car bonnet

If you’re self-employed or a small business owner and don’t have the required documents for a standard home loan application, then you may have heard about low doc and alt doc home loans.

What is a low doc home loan?

A low doc, or low documentation home loan could be taken out using fewer proof-of-income documents than what’s required for a traditional home loan.

However, due to requiring less documentation, low doc home loans didn’t allow lenders to meet their consumer credit obligations and are no longer widely available.

Tip: Alt doc loans serve a similar purpose in allowing borrowers who don’t have all the traditional documentation available. However, they still allow lenders to meet their credit obligations. 

Does Pepper Money offer a ‘No Doc’ home loan?

No, we don’t.  We do offer alt doc loans which can allow you to apply for a home loan with as little as 6 months NZBN and GST registration. Talk to one of our specialists to discuss what could work for you.

Low Doc vs Alt Doc home loans

While alt doc loans still require a full credit assessment and the need for borrowers to undergo serviceability and credit assessments, alt doc loans allow borrowers to prove their income in other ways. Quite often a borrower’s NZBN activity and business account statements will be used to validate income, rather than PAYE and tax return statements.

Tip: With Pepper Money, you can apply for an alt doc loan with as little as 6 months NZBN and GST registration. Meaning that once you’ve got your business setup, there’s no need to delay your property ambitions.

What documents can I use for Alt Doc home loans?

Our alt doc home loans are grounded in flexibility and allows you to prove your income or business activity in a few different ways:  

ABN registration for 6 months
Evidence of NZBN registration for 6 months
Evidence of GST registration
Evidence of GST registration for 6 months
A declaration of financial position
A declaration of financial position plus one of the following: 6 months business bank statements (inclusive of last 1 month) or 6 months business activity statements (BAS) or Pepper Money accountant’s letter.

How an alt doc home loan may be able to help

Flexible loan options, like alt doc loans, allow eligible self-employed and small business owners to buy their own home, invest in property or even grow their business. Our alt doc loan could enable these borrowers to consolidate business debts, pay out tax debts, and pursue their property ambitions. 

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You are protected by responsible lending laws. Because of these protections, the recommendations given to you about home loans are not regulated financial advice. This means that duties and requirements imposed on people who give financial advice do not apply to these recommendations. This includes a duty to comply with a code of conduct and a requirement to be licensed.

All loan applications are subject to the lender completing responsible lending checks and considering the borrower’s individual circumstances. Terms, conditions, fees and charges apply. Information provided is factual information only and is not intended to imply any recommendation about any financial product(s) or constitute tax advice. If you require financial or tax advice you should consult a licensed financial or tax adviser.

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