Prepare your paperwork for self-employed home loans

Getting onto the property ladder can be difficult at the best of times, but those hoping to secure self-employed home loans can often find the process more tiresome than others.

However, having all the right paperwork in order can make it much easier to achieve, so it pays to know exactly what evidence of your income lenders are likely to want to see.

Being prepared could improve your chances of being accepted, so make sure you're not caught unaware.

Business activity statements

No matter whether you're working as a freelancer or through some other arrangement, it is essential to have business activity statements to hand when applying for self-employed home loans. 

Generally speaking, the more of these you have the better. Lenders want reassurance you have a steady income and will be able to meet repayments on your mortgage.

The amount of statements you will need to provide can vary from lender to lender, so it might be worth getting in touch with them first.

Australian Business Number

Any lender will require your Australian Business Number – or ABN as it is commonly known as – when you make a home loan application.

This gives them the opportunity to check any details relating to your self-employed operations and cross-reference them with the information you have provided.

Borrower income declaration

If you are given the green light for a home loan for the self-employed, you will be asked to sign a borrower income declaration.

This document outlines what the loan entails and requires you to state that you are able to make the repayments without incurring any financial hardship.

Borrowers also need to ensure their lender that the loan will not impact on their ability to meet their existing financial obligations, which could lead to money problems further down the line.