Alex, a self-employed business owner, approached us with a dream of purchasing his first investment property. However, he faced a significant challenge: his most recent tax returns were incomplete due to the complexities of his growing business.
The Challenge
Alex’s situation presented several hurdles:
- Incomplete tax returns for the current financial year
- Urgent desire to enter the property market before prices increased further
- Need for a flexible lending solution that could adapt to his changing financial situation
Our Approach
After carefully assessing Alex’s situation, we developed a two-stage strategy:
- Short-term Solution: Apply for a low-doc loan to facilitate immediate property purchase
- Long-term Plan: Prepare for refinancing to a full-doc loan once tax returns were finalised
The Process
Stage 1: Securing the Low-Doc Loan
We assisted Alex in gathering alternative income verification documents, including:
- Business Activity Statements (BAS)
- A letter from his accountant
With these documents, we helped Alex apply for a low-doc loan with a lender specialising in self-employed borrowers.
Stage 2: Preparing for Refinance
While the low-doc loan allowed Alex to purchase his desired property quickly, we also put a plan in place for future refinancing:
- Set a timeline for completing and lodging tax returns
- Advised on organising financial documents for the eventual full-doc application
The Outcome
Thanks to this strategic approach:
- Alex successfully purchased an investment property in a growing suburb before prices increased further
- The property’s value appreciated by 15% in the 18 months before refinancing
- Once tax returns were finalized, we helped Alex refinance to a full-doc loan with a lower interest rate
This case demonstrates how a well-planned lending strategy can help self-employed individuals achieve their property goals, even when facing documentation challenges.
By using a low-doc loan as a stepping stone, Alex was able to enter the market sooner and benefit from capital gains, while ultimately transitioning to a more favorable loan product.
