Home Loans for Self-Employed Borrowers

Self-employed borrowers often assume home loan approval is harder for them — and while there's more complexity involved, a well-prepared application with the right lender is just as achievable. The key is knowing what lenders look for, and working with a broker who specialises in this area.

What "self-employed" means to a lender

Lenders define self-employed as anyone who owns 25% or more of the business they work in, or anyone who is a sole trader, contractor, or company director. The challenge is income verification: unlike PAYG employees whose income is verified via payslips, self-employed borrowers must demonstrate income through tax returns — which often understate actual earnings due to legitimate deductions.

Standard documentation required

• Last 2 years of personal tax returns and ATO notices of assessment
• Last 2 years of business tax returns (for company/trust structures)
• Business Activity Statements (BAS) — last 2 years
• Accountant's letter confirming your income and business stability
• Business bank statements (last 6 months)
• Business registration documents (ABN, ACN, trust deeds)

Low doc loans — an alternative pathway

If you've been in business for less than 2 years, or if your tax returns don't fully reflect your income, "low documentation" loans may be an option. These lenders accept alternative income verification such as BAS statements, bank statements, or a self-declared income supported by an accountant's letter. Interest rates are typically 0.3–0.8% higher than standard loans.