Low-doc lending finding favour again
The loans don’t require the same amount of paperwork as a standard mortgage and are popular with those who do not yet have the financial records to declare their income.
The interest rates offered are slightly higher than those of the mainstream banks.
They became infamous during the credit crunch for enabling people to borrow more than their incomes would allow, or for people who were not declaring large chunks of income to avoid tax. But brokers and lenders say the new low-doc loans are different from their predecessors.
Broker Jeff Royle told the Herald on Sunday he had processed 20 low-doc loans so far this year. He said that was a big increase on last year.
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