Financing while unemployed?

Hi Fire Ceasar,

The fact that your unemployed or employed does not necessarily matter, what matters is if you are able to service the loan. If your income from unemployment benefits and rental income will be enough, then you may be ok. Another option is, if you are able to produce 35% deposit, a number of lenders have no doc products in which you do not have to declare any income. I’m not sure about what the situation is in New Zealand however.

Regards,

Mortgageman

You don’t have to declare any income at all for a no -doc, simply provide your ID, so at 65% leverage, the lenders for these products do not even need to know (or want to know for that matter) your employment status. If an investment property you can obtain finance by applying as a professional investor, even if your unemployed. We have experienced this scenario previously and while many lenders won’t accept this scenario, I know some will. You may have trouble at 80% leverage, but the fact that you are unemployed does not automatically disqualify you from obtaining a loan.

Hi Terry.

Just because you have held an ABN for two years, won’t lenders want to see that you have been active with your “business”. By that I mean, can you just get an ABN to make it easier to qualify for lo-doc loans in the future, namely 2 yrs away. Also, when getting the ABN, what sort of business name would one have to submit, or could you just put “Joe Bloggs Enterprises” on the application form? Wont the ATO or future lender want to know at least what type of business you are running?

Thanks
Marty

Hi Maximus

When applying for low docs, the only proof of self employment needed is the ABN. They may also ask what sort of business you are invloved in and you will have to list an income.

When applying for an ABN, you cannot use a name, other than your own, unless you have registered that name with the department of fair trading. Many people just use their own names for business, and get an ABN.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]

Hi again Terry, thanks for the info. Just to clarify, if I apply to get an ABN you said “they (lending institution)may ask what sort of business I am involved in”. What, in your opinion, would be a feasible response if I wanted the loan for investment purposes?? And, “they may ask for an income”, what income could that be? Could I put down rent received from I/P’s,(or would I put down the anticipated rent from the I/P that I am trying to get the loan for) if so, would this be ok with the ATO or would it not matter

Thanx for your help.
Marty
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Hi Marty

When registereing an ABN, you could indicate you are a property investor. But if you tell the bank you are a property investor, they may ask about all your properties. If you have been self employed as property investor, and don’t have any property, they may say you are not self employed at that moment.

Wiht listing an income. You will be required to list you current income from self employment and any rental income as well – usually separately.

There may or may not be a problem with the ATO. If you are declaring $300K pa and do not actually make this, then theoretically the ATO could issue you an amended tax assessment taxing you on $300K. You would then have to prove you did not actually earn this.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]