What is a lease doc loan?

Any general questions you might have in regards to loans and finance.
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Otto Dargan
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Re: What is a lease doc loan?

Post by Otto Dargan »

Hi blimey. Welcome to the forum.

A lease doc loan does not require full evidence of your income. The lender instead relies on the strength of the rent income from the property used to secure your loan.

Similar to a low doc commercial loan, with a lease doc loan:
  • You can borrow up to 65% of the property value.
  • No payslips, tax returns, bank statements, BAS or financial statements are required.
  • The security must be a commercial or residential investment property.
  • Your loan must be National Consumer Credit Protection Act (NCCP) unregulated.
  • The lease must have at least 12 months remaining.
  • The lease must be at arm’s length, that is, not to your own company.
  • The lease income minus outgoings must be sufficient to cover the interest on your loan.
Regarding the loan term, it varies with the lenders. Most lenders review the loan term in line with the renewal of the lease. However, others may have a set 5, 15, or 25-year term. In addition, interest only periods may be considered depending upon the interest cover you have and the term of your lease.

Hope this covers the majority of your concerns.

Cheers,
Otto
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

User avatar
Otto Dargan
Mortgage Specialist
Posts: 7730
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
Contact:

Re: What is a lease doc loan?

Post by Otto Dargan »

Hi blimey,

Yes, owner-occupied properties are not considered for lease doc loans. That means a lease to your own business doesn’t count as income evidence! A lease to a family member’s business or to a related business entity also does not count.

You can use a commercial lease doc loan on a residential property if your loan in NCCP unregulated:
  • Loans in the name of a company (i.e. not to a “natural person”); or
  • Loans used predominantly to invest in commercial property, shares or a business.
Please call us on 1300 889 743 or enquire online and one of our mortgage brokers will see how to get you approved for a loan.

Cheers,
Otto
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

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