Low Doc loans for yellow goods

Just released.

Low doc loans for yellow goods.

No financials

No BAS

No accountants letter

No trading statements.

Must have clean credit and be for business use.

Includes, fork lifts and materials handling, excavators, diggers, skid steer loaders, trailers, tankers and earth moving equipment.

Similar criteria to low doc car loans:-

To qualify for these low doc yellow goods loans the excavator must be purchased from a licensed dealer.

Low Doc loans for yellow goods – property owner – NO DEPOSIT LOAN

  • Maximum low doc loan amount (including,insurances etc) of $100,000
  • New and used vehicles up to four (4) years old
  • Supplied via a licensed dealership (no private sales)
  • No negative equity to be financed
  • ABN held and gst registered for a minimum of 24 months by applicant (in acceptable industry)
  • Verified property owner with equity
  • Satisfactory Credit Report on applicant and guarantors
  • Standard rates, terms and residuals/balloons to apply
  • Total exposure for all low doc car loans to be less than $250,000*
  • Must be Australian resident.

Low Doc loans for yellow goods – non property owner

  • Maximum low doc loan amount ( insurances etc) of $70,000 after deposit
  • Minimum 30 percent deposit required on all loans
  • New and used vehicles up to four (4) years old
  • Supplied via a licensed dealership (no private sales)
  • No negative equity to be financed
  • ABN held and gst registered for a minimum of 24 months by applicant (in acceptable industry)
  • Satisfactory Credit report on applicant and guarantors
  • Standard rates, terms and residuals/balloons to apply
  • Total exposure for all low doc car loans must be less than $250,000*
  • Must be Australian resident.

Please note this low doc loans product is only available for commercial clients where bona fide business use can be verified.

 

Interest rates

Low Doc Home Loans interest rates.

Interest rates for low doc home loans can and do vary widely.

Currently there are three year fixed rates starting from 5.57% (CR 6.11%).  This low doc home loan is available through non bank channels. It is generally in line with normal home loan rates. Remember, you cannot walk into one of the big four banks and get this loan.

For Low Doc home loans, normally, if the LVR is 60% or less then the interest rate for  low doc home loans is similar to or the same as normal home loan rates. When the LVR starts to increase or there is some form of credit impairment that the spread between low doc home loans and normal home loans will start to widen.

Having said that, be careful in regards to which low doc home loan lender you go with. Lenders generally have the right to vary interest rates even after the low doc home loan has started.

There may be a perception that by going though one of the big four banks you will get a good low doc home loan rate.

however, the Commonwealth Bank (CBA) has recently advised its broker network to contact their low doc home loan customers to advise them that the bank will be raising the interest rates for some existing low doc home loans customers by 0.25%

CBA has said that it would be writing to all its existing low doc home customers with loans that were funded before 1 April 2012 to advise them interest rates will be lifted unilaterally. This means even though other rates are falling the rates for low doc home loans customers will increase mid December 2012

How significant is this move for low doc borrowers?

Well, to put things in perspective  it is believed that CBA currently has over $5 billion, yes $5 billion worth of low doc home loans on its books.

 

 

 

The future of Low Doc Loans

It is now common knowledge that the low doc loans of old have gone. Previously if you had an ABN,  had a 20% deposit, and completed a self-certified income declaration then it was fairly simple to get a low doc loan.

As the low doc market matured many of the major banks were lending at interest rates the same as or similar to normal full document home loans. This scenario could not last as it did not take into account the risk profile of low doc loans.

With the advent of the GFC and responsible lending low doc loans changed. This was a change for the better. What it did mean was income was now verified to a higher degree than previously.

This didn’t mean a return to full tax returns. It did mean alternative ways were looked at in substantiating income.

These generally include one of the following:-

  • a letter from your accountant  For many small businesses that use an accountant, who better knows their business circumstances than their regular accountant.
  • 12 months BAS statements  These statements give a good indication as to how the business is actually travelling. Given they are done every three months they are also timely.
  • 6 months business bank trading statements showing the income coming into the business. These statement show the inflows and out flows of the entity generating the income.

The alternative ways of assessing income, including the insistence of two years abn and gst registration by most lenders now mean that income verified under low doc loans is more thorough.

Having the abn and gst registration for two years shows the business is ongoing.

There are commentators that predicted the demise of low doc loans for many years. At this stage they have been proved wrong.

Low doc loans are and always will be a part of the home loan market. Many low doc loans are still be written and this shows no sign of changing.

A lot of  pundits forget that many of Australia’s small businesses are Australia’s wealth generators!

 

 

Hurry, is your low doc loan rate below 6%?

Low Doc Loans rates are moving up as predicted. The interest rates for fixed low doc loans and variable low doc loans are heading up.

Since the beginning of 2012 we have seen the rate for low doc loans start to get more expensive. If you currently have a low doc loan and your rate is above 6% please call us on 1300 LOW DOC. Hurry this rate for low doc loan refinances will not last long.

Update March 2012

Both low doc loans refinance and low doc loans purchase are still available with no application fee and no monthly fee up to 60%

The rates for low doc loans have now continued to move up. The 5.99% interest rate has now gone. If you are still quick you still may be able to lock in a rate below 6.1%

Remember these low doc loans require no BAS and no accountants letter. However, 12 months business bank trading statements is needed to show strong income.

Hurry

Call us on 1300 LOW DOC

Commercial Low Doc Loans

Everyone is now aware low doc loans are definitely harder to get than a few years ago. Having said that, as people become used to the new credit environment, we are now seeing customers start to offer BAS statements. This didn’t occur previously.

It seems people are now being conditioned by the banks that more paperwork is required when applying for low doc loans. The normal options are either Accountants letter, BAS statements, or trading statements. This extra paperwork applies to residential property low doc loans which are governed by the NCCP.

In regards to commercial low doc loans, in many cases we don’t require all this extra paperwork. We have recently been offered access to funding large low doc commercial loans with a minimum loan size of $3m. As well as the large low doc commercial loans there is now development finance becoming available for deals that the banks wont do.

As always, if you have a scenario regarding low doc commercial loans please call us.

 

Free Property Market Update

As well as a lot of news in the media about low doc loans there is also a lot of comment about what is happening to investment property prices. With so much differing comment out there in the news it is difficult to know what is really happening, and where the market is heading.

Would you like a property market update?

Please note this report is free and very detailed. It contains a lot of information.

If you would like a free property market update, then please visit the Investment Property website, fill out the form and you will be emailed a free property market report.

The report contains a snapshot of what is happening in the major cities, house and unit prices, changes in dwelling values, and capital cities capital growth and sales volume.

The report is over 20 pages in length. For full details of what is contained within the report see Investorpac.

 

Low Doc car loans

LOW DOC Car Loans

Low Doc car Loans for purchases are still available in 2015 as long as the vehicle being purchased is to be used for a commercial, or business purposes.

Low Doc Car Loans with:-

No BAS

No Tax returns

No Accountants letters

No mortgage insurance

To qualify for low doc car loans you must have an ABN for at least 24 months, and have clean credit. The vehicle must be purchased from a licensed dealer.

For full details and rate see Low Doc car loans

Low Doc Loans have changed

From Jan 1 2011, banks have brought in guidelines to comply with the new National Consumer Credit Protection Act (NCCP). Lenders now require evidence that you are able to repay a loan. This means that low doc loans now generally need, either BAS statements, trading statements or an accountants letter, to show that the customer can service a loan.

Low Doc Loans are not dead! Low doc loans are still available, however, they now require more verification.

With the banks adopting more cautious lending policies  it would appear the self employed, as the largest group of low doc loans borrowers, have been the hardest hit by both the GFC and NCCP.  As with anything new it will take time to adjust, however, eventually small business owners will adapt to the new credit environment we are in.

Low Doc Construction loans

ANZ low doc loans require BAS

ANZ has now joined with the other banks to implement changes to its ANZ low doc loans. This is in line with the responsible lending guidelines under the NCCP. Westpac has been for a long time requiring BAS statements on its low doc loans. CBA has just recently changed its lending criteria and low doc loans policy and now require BAS on all low doc loans irrespective of LVR. Suncorp also require BAS on all Suncorp low doc loans.

So in conclusion, the lending criteria for major banks is now changing rapidly, and BAS is now part of the landscape.

Low Doc Loans going forward

We are now seeing low doc loans harder to obtain.

There has been a real tightening of credit policy by the banks. The days of the low doc declaration only have disappeared. Banks are now starting to take a “limited income evidence” approach. CBA have just changed their low doc loans policy to require BAS statements on all low doc loans.

Further, we have just seen RAMS Home Loans founder John Kinghorn warn that home loans to self employed may dry up.

What does this mean for those looking for low doc loans?

Lenders are looking for further verification as to the income declared. This can take the form of bank trading statements, BAS statements or an accountants letter.

Currently the more difficult low doc loans are 80% low doc refinances and construction.

Low Doc Construction Loans

Low Doc Loans 70 Refinance

Low Doc Loans 70% refinance with no mortgage insurance.

• NO LMI applicable between 60% & 70%
• Max loan amount $1.5m on single security and $2m for multiple securities
• Available for purchases and refinance (no cash out or consolidation of unsecured debt)
• Refinance business debt up to 20% of loan amount
• Company and trust borrowers acceptable
• Construction available
• Bridging Finance
• 100% Offset
• Lo Doc to full doc conversions available anytime
• BAS and Bank Statements
• Lo Doc declaration & Accountant verification

Low Doc Commercial Loans

Low Doc Commercial loans are still available up to a maximum LVR of 80% on good commercial properties in major metropolitan areas. The maximum loan size at 80% is $1 million. Larger loans are available at lower LVRs.

Applicants, which can also include companies, must have clean credit and current loan must have been paid on time. This is to be shown through six months loans statements. Specialised securities are not acceptable at 80%. Can be for both owner occupiers and investors. Must have 2 years ABN.

Max interest only period is normally five years.

True term loan.

Interest rates for Low Doc Commercial Loans

Low Doc Loans 80% refinance

Low Doc Loans can be used to refinance existing home loans at 80%, however they are harder to get approved due to the tightening of credit criteria by the banks.

As a guide the loan being refinanced should be a full document loan and if there are any extra funds being requested then the purpose of these extra funds must be clearly stated.

Full Doc Loan to Low Doc Loan at 80%

For 80% refinance low doc loans

Require:-

  1. Income Declaration Form
  2. BAS
  3. No business trading statements
  4. Six months current loan statements (including credit card statements) showing excellent repayment history (absolutely no over limit or missed payments)
  5. Clean credit
  6. Two years ABN
  7. Registered for GST
  8. The applicant must be clearly able to demonstrate capacity to repay the loan.

Low Doc Loan to Low Doc Loan at 80%

If the loan being refinanced is a low doc loan and you want to refinance to 80%, the purpose of the extra funds must be clearly explained. The applicant must be clearly able to demonstrate capacity to repay the loan.

Require

  1. Income Declaration Form
  2. BAS
  3. Three months business trading statements
  4. One months personal statements
  5. Six months current home loan statements showing excellent repayment history (absolutely no over limit or missed payments)
  6. Clean credit
  7. Two years ABN
  8. Registered for GST
  9. 60 to 70% NO LMI charged to customer

Large Low Doc Loans

Large low doc loans are still available.  Many lenders are now capping out their maximum low doc loan amount at $1 million. There is still funding for large million dollar low doc loans above this figure. As a guide you are looking at 1% set up costs and a normal investment home loan rate. Maximum 60% LVR and sound residential security. Cash out available in certain circumstances. Ideal for purchasing or refinancing prestige property.

Updated March 2012

Large Low Doc loans are still available up to $1.5m in major metro areas. If you are looking for a jumbo low doc loan over $2m then these may be available however they are discretionary. The applicant needs to have clean credit, have a strong asset and income position. BAS are not required and neither is an accountants letter. What is required is evidence of strong bank trading statements for the last 12 months.

The maximum LVR is up to 60% of the property value, with a lower LVR being preferred.

Please call us on 1300 LOW DOC     1300 569 362

 

Bankwest low doc loans

Effective Close of business 30 April 2010 Bankwest Low Doc Home Loans will be withdrawn from sale.

What does this mean?

Refinances will no longer be available, using a Bankwest Low Doc Loan.

For purchases there will be the re launch of the Easy Doc Product. This means there will only be one rate irrespective of the LVR. The Easy Doc Home Loan will automatically roll to the Lite Home Loan after the 3rd year anniversary date.

Updated March 2012

Bankwest Low Doc Loans have the following features:-

BankWest Low Doc Home Loan

No BAS
No monthly account fee
A straight-in variable rate home loan product for self-employed borrowers.
Self declaration form with an accountants sign off
New Purchases max lend = 80% LVR – $1m
Max lend $2.5m per loan without LMI
Refi available only on land to 60% where obtaining construction funds
100% offset account available
No trading statements required
Can roll to any product if satisfactory conduct throughout previous two years
LVR = 60%
LVR = 80%

Refinancing Low Doc Loans

Bankwest will still not do refinances with their Low Doc Loan product, however we do have other lenders that will refinance Low Doc Loans up to 80% of the value.

Purchasing

Bankwest will do purchasing through their Low Doc Loans and have two tiers. One low doc loan is done up to 60%. The other low doc loan is done up to 80% and is at a slightly higher rate and will need to be mortgage insured. Both Bankwest Low Doc Loans require an accountants letter, however, if you need an alternative without an accountant’s letter this is possible. With the alternative the main criteria is there must be substanial deposits into the business entity’s bank trading account for the last 12 months.

Want to know more please call us on 1300 LOW DOC,   1300 569 362

 

 

Low Doc Loans mortgage insurance postcodes

Low Doc loans are historically divided into two categories. Low Doc Loans without mortgage insurance and low doc loans that are mortgage insured.

60% LVR

Generally low doc loans 60% or less do not require mortgage insurance.  For this reason they are easier to qualify for. However, they do require 40% equity.

Up to 80%

These low doc loans are normally mortgage insured, however, it is possible to get 80% low doc loans without BAS, without mortgage insurance. For the mortgage insurance low doc loans, one of the first things looked at is the postcode. In many cases, the postcode of the security property will determine what level the mortgage insurer will go to. To search these mortgage insurance postcodes, click on this location wizard, and enter your postcode.

The figure under LMI Self Certified is the maximum loan size the mortgage insurer will consider in that postcode.

If your postcode returns “On Application”, then this generally indicates that in the eyes of the mortgage insurer the security area may not be as strong.

CBA Low Doc Loans increase .25%

CBA Low Doc Loans and ANZ Low Doc Loans have both moved quickly to increase their rates by 0.25%

St George Low Doc Loans and Westpac Low Doc Loans have held off moving more than the RBA rate increase as well.

Both the CBA and ANZ will also increase their deposit rates by 0.25% as well

Are rates heading back to normal?

What’s normal home loan rates?

As a footnote to the above, ANZ Low Doc Loans are no longer being done at 80%. CBA and many of the major banks are now requiring BAS statements with their 80% low doc loans. Given this need for BAS is this really a low doc loan? There are still alternative low doc lenders out there at 80% for both purchases and refinances that do not need BAS.

Rural Low Doc Loans

Rural low doc loans now available for loans that have an investment purpose. Generally for a year only, so there needs to be a clear exit strategy so the loan can be paid back. These types of loans are normally low LVR, and it is preferable there is a building on it, although not mandatory.

85% LVR Low Doc Loan for clean credit still achievable in major metropolitan areas.

Also Low Doc Loans for vacant land are still attainable as long as land has an investment purpose. A low doc loan for vacant land is similar to a Serviced Apartment Low Doc Loan and is considered on a case by case basis.

Looking for a low doc loan for your motorcycle purchase, or a marine low doc loan? then call us 1300 LOW DOC

Low Doc Loans 80 No BAS

Low Doc Loans 80% No BAS now available for refinance and purchase. No Business Activity Statements required. Clean credit only.
Available in major metropolitan areas. Must be zoned residential and have a building in sound condition on the property.

Rates are different dependent on upon whether it is a refinance of an existing low doc loan, or a purchase. Rates as per the home page.

If you are in Sydney, the rate may be cheaper for the LOW DOC 80 with NO BAS NO ABN refinances.

Low Doc Construction 80% LVR with No BAS returns also considered in major metropolitan areas. Tender must be from a major licensed builder.

RBA Interest Rates for 2009/2010/2011/2012/2013

The rate for low doc loans is partly driven by RBA interest movements.

RBA interest rates are normally set when the bank meets on the first Tuesday of each month, except January.

2009

RBA interest rates for 2009

• Tuesday, 3 February 2009 rates        decrease 1%
• Tuesday, 3 March 2009                    No change
• Tuesday, 7 April 2009 rates              decrease .25%
• Tuesday, 5 May 2009                       No change
• Tuesday, 2 June 2009                       No change
• Tuesday, 7 July 2009                        No change
• Tuesday, 4 August 2009                    No change
• Tuesday, 1 September 2009              No change
• Tuesday, 6 October 2009 rates          increase .25%
• Tuesday, 3 November 2009 rates       increase .25%
• Tuesday, 1 December 2009 rates       increase .25%

At the RBA meetings, when they move their rates, the variable rates for low doc loans normally move as well. Having said that, the major banks can, and do move their rates when and how much they want.

As a guide, and a guide only, you can expect the variable rate for most low doc loans to sit between 2 and 3% above the current RBA cash rate target.

2010

RBA interest rates for 2010

• Tuesday, 2 February 2010 rates on hold
• Tuesday, 2 March 2010 rates       increase .25%
• Tuesday, 6 April 2010 rates          increase .25%
• Tuesday, 4 May 2010 rates          increase .25%
• Tuesday, 1 June 2010                  No change
• Tuesday, 6 July 2010                   No change
• Tuesday, 3 August 2010               No change
• Tuesday, 2 September 2010         No change
• Tuesday, 5 October 2010             No change
• Tuesday, 2 November 2010          increase .25%
• Tuesday, 7 December 2010          No change

2011

In 2011, at the RBA meetings, the bank has set the rates as follows:-

RBA interest rates for 2011

• Tuesday, 1 February 2011          No change
• Tuesday, 1 March 2011              No change
• Tuesday, 5 April 2011                 No change
• Tuesday, 3 May 2011                 No change
• Tuesday, 7 June 2011                No change
• Tuesday, 5 July 2011                 No change
• Tuesday, 2 August 2011             No change
• Tuesday, 6 September 2011       No change
• Tuesday, 4 October 2011           No change
• Tuesday, 1 November 2011        decrease .25%
• Tuesday, 6 December 2011        decrease .25%

2012

• Tuesday, 2 February 2012          No change
• Tuesday, 6 March 2012              No change
• Tuesday, 3 April 2012               No change
• Tuesday, 1 May 2012               decrease .5%
• Tuesday, 5 June 2012              decrease .25%
• Tuesday, 3 July 2012               No change
• Tuesday, 8 August2012           No change
• Tuesday, 4 September 2012     No change
• Tuesday, 2 October2012         decrease .25%
• Tuesday, 6 November 2012     No change
• Tuesday, 4 December2012         decrease .25%

2013

• Tuesday, 5 February 2013           No change
• Tuesday, 5 March 2013               No change
• Tuesday, 2 April 2013                  No change
• Tuesday, 7 May 2013                  decrease .25%   
• Tuesday, 4 June 2013                 No change
• Tuesday, 2 July 2013                   No change
• Tuesday, 6 August 2013              decrease .25%
• Tuesday, 3 September 2013
• Tuesday, 1 October 2013
• Tuesday, 5 November 2013
• Tuesday, 3 December 2013

The current RBA cash rate target is 2.5%

What is the future for Low Doc Home Loans?

Low Doc Loans have been around for many years. Previously low doc loans were done through solicitors funds at around 66%.

Over time, the banks then started to slowly start to enter this space. In 2005, the RBA commented about Low Doc Loans.

For the full article.

With the beginning of the credit crisis in 2008, there was a general tightening of lending across the board. Much of this was to do with bad credit. There has been confusion between bad credit and Low Doc Loans. In Australia they are different. Most Low Doc loans in Australia are for self employed with minimal paperwork and are normally clean credit.

Standard & Poor’s in October 2009, has indicated Low Doc Loans in Australia are not a problem.

Standard & Poor’s has backed the government’s decision to direct the Australia Office of Financial Management to invest in residential mortgage backed securities with a higher proportion of small business loans when it invests the additional $8 billion the government has allocated to support new RMBS issues.

For the full article.

Low Doc Loans are still being written, but they change as the credit markets change. With the norm for the banks now being 60%, Low Doc Loans have effectively gone full circle. Low Doc Loans without BAS at 80% are still possible, however they will be priced according to risk.

With this in mind, even though lending for Low Doc Loans has tightened, with the credit markets starting to free up again, over time, Low Doc lending will also start to free up again as well.

If you want to know the future for Low Doc Loans, one guide is to look at the general credit markets. When things are perceived as bad, low doc lending will be tight. When things are perceived as optimistic, low doc lending will be more liberal.

Since writing this post in late 2009, in March 2010 Macquarie has already returned to the low doc market. This is an indication of where we are heading and it has happened quite quickly.

Macquarie Low Doc Loans

Given the current credit climate it may also be timely to remind customers of the risks associated with Low Doc Loans. The following from ASIC may help.

The above is information only and not advice.