Home loans for the self-employed

Being self-employed doesn't mean that you can't own your home. The big banks can make it difficult for self-employed workers to get a home loan, often requiring them to jump through extra hoops or labelling them as too high-risk. As a non-bank lender, we specialise in self-employed home loan options. We're here to help those with non-standard incomes – including those with only 6 months of ABN and GST registration.

We take a careful look at both your personal and business cash flow to ensure that you can comfortably make your regular home loan repayments. Depending on the level of documentation that you can provide, self-employed borrowers generally fall into two categories: full doc or alt doc.

If you're self-employed and are looking at applying for a home loan, it can be challenging due to the lack of a fixed income that many lenders require as part of the process. However, non-bank lenders like us at Pepper Money may still be able to help you with our flexible approach to self-employed home loan options.

All lenders look at your finances, business turnover, and credit history to determine your ability to repay the loan. Providing evidence of income is important and typically includes bank statements, ABN and GST registration that will be reviewed to assess your ability to manage the loan. 

Committing to a larger deposit could also increase your chances of securing a self-employed home loan and reduce interest charges. 

There are two types of income documentation options available for self-employed borrowers; full documentation (Full Doc) or alternative documentation (Alt Doc). 

It could be helpful to provide all the financial documents and income evidence that you have available to help qualify for a full doc home loan. This could put you in a better position to borrow more and potentially secure a more favourable interest rate.

Here are some of the requirements needed to apply for a home loan if you’re self-employed:

For Full Doc:

• Last two years tax returns and notice of assessments or
• Last two years’ financial statements executed by a registered accountant or tax agent

For Alt Doc:

1. Evidence of ABN registration for 6 months
2. Evidence of GST registration for 6 months
3. Declaration of financial position plus one of the following: 6 months business bank statements (inclusive of the last 1 month), or 6 months business activity statements (BAS) or Pepper Money accountant's letter (Accountant's letter not accepted if ABN registered for < 12 months).

If you work for yourself or fall under the category of “self-employed”, applying for a home loan can be quite a challenge even with regular income. All lenders will need to establish your income, assets, savings, and financial capacity to pay back a loan before considering your application. They may also look at the financial position of your business. Unfortunately, many mainstream lenders, like the banks, see self-employed people as high-risk borrowers. But this does not necessarily mean you cannot qualify for a home loan. When you're self-employed, you might need to look beyond the big banks to the non-banks like us at Pepper Money for a lending solution.

Here are some tips and tricks to help get your loan application approved.

On some of our loan options, we offer finance up to 95% of the purchase price, meaning you can start to look at buying a house once you've saved at least 5% of the purchase price. The deposit amount needed may also depend on the property and area you’re looking at purchasing.

Remember, you’ll also need funds to be able to cover any loan fees, stamp duty and other government charges. These can’t be added to your home loan balance.

The interest rate offered, and fees and charges will depend on our assessment of a number of factors at the time of application including:

• The amount of your deposit or existing equity (if refinancing)
• Nature of the security property (or the property you have equity in if refinancing)
• Loan to value ratio (LVR)
• Your income
• Credit history
• Any assets you own
• Any liabilities or credit obligations
• Chosen repayment type – paying off interest-only, or principal and interest
• The purpose of the loan – if it’s for an owner-occupier or investment property

To get an indicative interest rateˇ, you can start by using our online borrowing power calculator, or speak to one of our Lending Specialists on 137 377.

Certain Pepper Money fees can be added to your loan balance, while others will need to be paid upfront – fees that can be added include establishment or application fees, as well as risk fees or lender protection fees. A small admin fee will be added to your loan each month. 

Take a look at a summary of our home loan fees.   

The fees that can’t be added to your loan balance include solicitor fees along with local and state government taxes and levies – these are usually paid upon settlement.

Your Pepper Money Home Loan Journey – from application to actual settlement – can take up to six weeks – this is the typical timeframe for a home purchase, however, the process may be quicker if all the necessary documentation is provided sooner. 

Delays in decisions are most commonly caused by incorrect or missing documentation. 

Learn more about the Pepper Money Home Loan application process or for more information speak to a Lending Specialist on 137 377.

Our home loan borrowing capacity calculator asks a few easy questions (personal and financial) to calculate an estimate of how much you may be able to borrow with us at Pepper Money. After finding out how much you could potentially borrow, you can then either speak to a Lending Specialist about your situation or continue to get an indicative interest rateˇ online.

See how much I can borrow

We’re one of Australia's leading non-bank lenders! 

We were established way back in 2000 to help Australians achieve their financial dreams by providing flexible financial loan options that could factor in the ups and downs of real life. Since then, we’ve become one of the largest, most trusted, and award-winning non-bank lenders in Australia and New Zealand. 

If you're self-employed, then submit an online enquiry or call our team on 137 377.