Forums / Getting Technical / Finance / Is this a Low Doc request or not?

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  • Profile photo of LouiLoui
    Participant
    @loui80
    Join Date: 2016
    Post Count: 13

    Hi guys,

    My sister and bro in law have a low Doc loan with Wbc for 300k on a property worth 1.0m. No other debts. They need 100k cash out to pay my parents for monies owed for the reno they did. My sister now works as a teacher earning 50k gross plus they have a rental property they get 12k in income a year. They have 2 kids. Unfortunately my sisters income alone cannot service the debt and all other expenses and my bro in law can make up the shortfall as he makes about 30k a year on a part time basis for his business. This would get it over the servicing shortfall I believe but problem is he is not registered for gst and does not lodge bas statements. What lenders can look at this? It is a no risk deal with such a low lvr but I know major banks will cause them grief due to the gst issue and responsible lending piece. Have not approached current lender yet but I would not hold my breath. Any help would be appreciated.

    Profile photo of Corey BattCorey Batt
    Participant
    @cjaysa
    Join Date: 2012
    Post Count: 1,010

    If he legitimately makes $30k/yr net profit before tax in the business and have tax returns showing him receive this consistently, they may be eligible for a full doc loan. BAS/GST registration is not a requirement of full doc loans, unless they’re claiming they’re earning above the GST threshold but not registered. ;)

    Best they speak with a broker who is used to dealing with self employed clients and they can run through the exact options for them – it sounds like a nice simple one.

    Corey Batt | Precision Funding
    http://www.precisionfunding.com.au
    Email Me | Phone Me

    Investment Focused Finance Strategist - servicing Australia-wide

    Profile photo of Richard TaylorRichard Taylor
    Participant
    @qlds007
    Join Date: 2003
    Post Count: 11,992

    Sounds like a fairly straight forward deal given the income is declared net profit.

    Remember GST has nothing to do with earnings but more to do with turnover.

    Cheers

    Yours in Finance

    Richard Taylor | Mortgage Broker helping investors build their wealth thru property
    http://www.mortgagecapitalaustralia.com.au
    Email Me | Phone Me

    0-40 Properties in a decade with a unencumbered portfolio value in excess of $40M. Ask me for a copy of my API Interview.

    Profile photo of RCastleRCastle
    Participant
    @specialistlending
    Join Date: 2017
    Post Count: 1

    When it comes to these sort of specialist circumstances, I always point towards education. Inevitably your broker will be the guiding light, but it helps to understand the types of specialist loans out there and what they mean.

    RCastle | Fortress Funding
    http://fortressfunding.com.au/

    Help when the banks won’t

    Profile photo of Ethan TimorEthan Timor
    Participant
    @ethantimor
    Join Date: 2016
    Post Count: 282

    Lenders will look at your brother in law tax returns. If the numbers work, there shouldn’t be an issue.

    Suggest having a preliminary discussion with a broker to get specific advice.

    Cheers,
    Ethan

    Ethan Timor | Aligned Finance Pty Ltd
    http://www.alignedfinance.com.au/
    Email Me | Phone Me

    Active Investor & Broker; Based in Northern NSW, servicing Australia wide; Author of '34 Proven Ways to Maximise Your Borrowing Power' (download free from our website)

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