Loans For Business Owners
Being self-employed offers tremendous freedom and flexibility, but it can present some challenges when it comes to securing a mortgage. At Avenstone, we’ve helped countless self-employed borrowers secure home loans, using our years of experience to guide you through the process with ease.
What Defines a Self-Employed Individual in Australia?
In Australia, you are considered self-employed if you:
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Operate using a registered ABN (Australian Business Number)
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Manage your own tax and superannuation affairs
Who Qualifies for Self-Employed Home Loans?
When determining your eligibility for a self-employed home loan, lenders typically consider:
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The duration of your ABN registration
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The nature of your business and trading structure
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The complexity of your business model
Self-employed individuals come from various backgrounds, including:
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Business Owners: SME owners, founders, franchise owners, sole traders, partnerships
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Freelancers and Independent Contractors
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Tradespeople: Electricians, plumbers, builders
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Health & Wellness Professionals: Personal trainers, fitness instructors
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Creative Professionals: Musicians, actors, filmmakers
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Professional Services: Accountants, lawyers, consultants
Self-Employed Home Loan Requirements
To qualify for a home loan when self-employed, you typically need:
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At least two years of tax returns and financial statements.
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Some lenders may accept only one year of tax returns or alternative income verification.
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Evidence of consistent income, such as tax returns, financial statements, and business records.
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If you’ve recently started a business but have experience in the same industry, some lenders may still consider your application, even if you don’t have full tax returns yet.
Home Loans for Self-Employed Individuals with Less Than 2 Years of Experience
If you’ve been self-employed for between one and two years, some lenders may still approve your loan, especially if you have been in the same industry prior to starting your business. For example, a plumber who has been self-employed for a year but worked as a plumber for five years prior may qualify for a loan.
Home Loans for Self-Employed Individuals with Less Than 1 Year of Experience
If you’ve been self-employed for less than one year, most banks may not approve your application. However, some lenders may consider your income from your previous job as a substitute for income verification, provided you can demonstrate that you could return to a similar job if your business were to close. Based on this, we can help you secure up to 80% of the property value.
Flexible Solutions for Self-Employed Borrowers
Our tailored solutions for self-employed professionals are designed to make the mortgage process easier and more accessible, no matter how long you've been running your business.
What Documents Are Needed for a Self-Employed Home Loan Application?
To apply for a full-doc self-employed home loan, you will typically need:
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Personal tax returns from the past two years.
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Most recent ATO Notice of Assessment or a letter from your accountant confirming your returns are lodged and final.
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Business tax returns from the past two years.
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Business financial statements, including Profit & Loss statements, balance sheets, and depreciation schedules from the most recent year.
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Proof that your business has been profitable in the last two years.
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An active ABN for at least 18 to 24 months.
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If your business earns more than $75,000 per year, you must be registered for GST and lodge regular Business Activity Statements (BAS).
What If I Can’t Provide Certain Documents?
If providing full documentation is not possible, low-doc loans are available. With low-doc loans, lenders may accept a declaration confirming your income, allowing them to assess your loan based on this self-reported information. Keep in mind that low-doc loans may come with:
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Higher fees than full-doc loans.
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Risk fees for loans exceeding 60%-70% of the property value
For more information on low-doc loans or to learn more about alternative income verification, book a free 30-minute discovery call. Our mortgage brokers will guide you toward the right lender with the best loan package.
Why Choose Avenstone for Self-Employed Home Loans?
At Avenstone, we specialise in helping self-employed borrowers navigate the complexities of securing a home loan. Here's why you should choose us:
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Expertise in Self-Employed and Low-Doc Loans: Self-employed loans require a higher level of understanding than traditional PAYG loans. Our brokers have experience with the intricacies of these applications, ensuring a smooth and efficient process.
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In-Depth Understanding of Your Needs: We know that self-employed individuals face unique financial circumstances. Our brokers have firsthand experience of self-employment, giving us a deep understanding of the challenges you face.
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Tailored Solutions: We offer a personalised approach to each applicant, ensuring that we find the best lender and loan package for your needs.
Frequently Asked Questions about Loans for Business Owners
Apply for a Self-Employed Home Loan Today!
Start your application today and take the first step towards securing a home loan as a self-employed borrower. Call us on (03) 9566 7247 or book a free 30-minute discovery call todayand let our experts guide you through the process with confidence.
Years Experience
20+
in Residential & Commercial Banking