A psychiatrist came to see me not long ago who had just been told, by all four major banks, that he would have to wait two years before any of them would lend to him.
There was nothing wrong with his income. He earned well and he could clearly afford the repayments. His only “problem” was that he had recently moved his practice into a company structure, on his accountant’s advice, and the banks did not want to know until he had two full years of company financials behind him. Two years, out of the market, for doing something his accountant had told him was the right move.
He did not wait two years. We had him sorted well before that. This is the part of home loans for professionals that most people never get told about.
The deposit rule is not what you have been told
Start with how much of a property you can actually borrow against. Most people carry around the “you need a 20% deposit” line as if it is law. It is not.
Depending on your situation, plenty of lenders will fund up to:
- 95% of the value on an owner-occupied loan
- 90% of the value on an investment loan
That figure is your loan-to-value ratio, or LVR. Borrow at a higher LVR and you can get in with a smaller deposit and stop waiting. It usually means paying lenders mortgage insurance above 80%, and the maximum on offer comes down to the lender, the property and you. But the idea that every buyer needs a fifth of the purchase price in cash is simply out of date.
Why a company structure spooks the big banks
Back to my psychiatrist. The reason the big four all said no is boring and predictable: their policy wants two years of financials under the current structure, full stop. New structure, no history, no loan. Computer says wait.
I see this constantly with self-employed clients and professionals. The majors run a one-size-fits-all rulebook, and if your situation does not fit the box, the answer is no rather than “let me look closer.” It is not personal. It is just how they assess.
And to be honest, I would not tell anyone to change to a company structure purely to look better to a bank. Usually that is the wrong reason to do it. But when the structure is right for your business, as it was for him, it should not cost you two years in the property market.
What actually got him approved
Instead of accepting the wait, I took his file to a lender with a specialist credit team and we used projections to show serviceability, rather than waiting on two years of historical numbers. Same person, same income, same ability to repay. The only things that changed were the lender and the way we put the application together.
That is the whole game with professional and self-employed lending. It is rarely about whether you can afford it. It is about finding the lender whose policy fits, and presenting your situation so it gets assessed properly.
Not every lender reads your file the same way
This is the bit that is almost impossible to see from the outside. One lender wants two years of financials. The next will take one. Another will accept accountant-prepared projections, or take a more generous view for certain professions.
A good number of lenders are genuinely open to looking at professional occupations on their merits. The trouble is your own bank will never point you to a competitor with a better policy, so unless you know where to look, you take the first no as the only answer. That is the gap a broker exists to close.
So, does this apply to you?
If you are self-employed or running income through a company or trust, a recent structure change does not have to mean a two-year wait. If you are a professional or a high earner, some lenders have more flexible policies, and sometimes higher LVRs, for people in your line of work. And if you are a first home buyer or investor still saving toward a 20% deposit, it is worth checking whether you actually need it before you spend another year saving.
A few questions I get asked
Can I get a home loan through a company or trust?
Yes. Plenty of lenders will. The trick is picking one whose policy suits your structure and getting the application right.
Do I really need a 20% deposit?
Often no. Some lenders go to 95% for owner-occupiers and 90% for investors. Lenders mortgage insurance generally applies above 80%.
I just moved to a company structure. Am I stuck for two years?
Not necessarily. Some lenders will work off projections or a shorter track record instead of two years of financials. That is exactly what we did here.
What can a broker do that my bank cannot?
Your bank can only offer you its own policy. I can see across a lot of lenders, know which ones suit professionals and self-employed borrowers, and put your file in front of the right one.
Talk to The Brokerage
If a bank has told you to wait, get a second opinion before you accept it. We work with professionals, business owners and self-employed clients across Brisbane, Sydney, Melbourne and the rest of Australia, and matching the right lender to the right situation is what we do all day.
Get in touch with The Brokerage.
0451 973 662 | enquiries@thebrokerage.au | thebrokerage.au
General information only. This article does not take into account your personal circumstances and is not financial or credit advice. Lending criteria, interest rates and maximum LVRs vary by lender and are subject to approval. Lenders mortgage insurance may apply. Please seek advice tailored to your situation.