Commercial Lite Doc Loan
Commercial lite doc loans and mortgages are available with a handful of lenders and financial institutions. Lite doc commercial loans look at a combination of supporting income documents without the need to provide full financials to verify serviceability for a proposed mortgage.
What is a Commercial Lite doc loan?
Commercial lite doc loans are loans with less supporting financial income documents than normal full doc loans. They still require some basic income verification but with no need to look at full financials of the proposed borrower.
What types of documents are required for Lite Doc Commercial loan?
Lite doc commercial loans and mortgages have some similarities to low doc loans. Lenders who offer lite doc commercial loans generally require an income declaration from the borrower, supported by an accountant’s letter confirming the income is a reasonable estimate of the borrower’s income.
What types of properties can be used for a Lite Doc Commercial loan?
The types of properties used for lite doc commercial loans are:
- Commercial property
- Industrial property
- Retail property
- Office property
- Residential property (provided the property is NOT in a personal name)
Are Commercial Lite Doc loans more expensive?
Commercial Lite doc loans can come with a slightly higher interest rate than normal loans. This difference is due to the fact that the funder is not lending based according to your financials or tax returns, but rather taking both a signed declaration of affordability supported by an accountants verification and confirmation letter. This gives you a cheaper option than a low doc loan, whilst keeping you very close to a normal rate.
When comparing different types of loans, many borrowers consider the Lite Doc Commercial as a good, cost effective option particularly when their situation is not straight forward.
What loan product types are available with Commercial Lite Doc loans?
There are a few different product types available for commercial lite doc loans. These include:
- Variable term loan
- Fixed rate interest loan
- Lines of credit loan
When choosing a lender, you must consider if they offer the full product suite as only a few of the lenders who offer commercial lite doc loans will offer each loan type of product.
What are the advantages of a commercial lite doc loan?
The advantages with taking out a lite doc commercial loan are that these types of loans are generally reasonably priced considering the lack of supporting income documents required and without the hassles of a full financial assessment. A commercial lite doc mortgage comes in handy for borrowers who have not completed their financials by the due date, yet still require reasonably priced finance. Commercial Lite doc loans have a maximum LVR of 75%. This 75% LVR gives a borrower a high lending ratio than most major bank’s full doc LVR parameters!
What are the disadvantages of a commercial lite doc loan?
The disadvantages with commercial lite doc loans start with a slightly higher interest rate. Further, commercial lite doc loans are only available with a very small number of lenders, and therefore there is not much pricing competition amongst lenders for this type of business. Hence your lending options are restricted to a handful of lenders.
At Mortgage Providers, we have extensive experience with different lenders who offer Commercial Lite Doc loans. We can make the distinctions between a lender who offers the cheapest rates and fees whilst also knowing which lender offers the most flexibility!