TL;DR Summary
Always choose full doc if you qualify — it gives you lower rates, higher LVR, and more lender options. Choose low doc when your tax returns don't reflect your real income, when you have less than 2 years of returns, or when your declared income is low due to tax minimisation. Some lenders also offer hybrid approaches. A specialist broker determines the best path for your documents.
What Is a Full Doc Home Loan?
A full documentation (full doc) home loan is the standard home loan product where income is verified using traditional tax documents. For self-employed borrowers, this typically means:
- 2 years of personal tax returns — lodged with the ATO, showing net income
- 2 years of Notices of Assessment (NOA) — the ATO's confirmation of your tax assessment for each year
- Accountant's letter — confirming income, business structure, and sustainability
- Business financial statements — profit and loss, sometimes balance sheet
Full doc loans are available at standard rates from most lenders — including the major banks — and allow borrowing up to 95% LVR (with LMI). They are always the preferred option when the documentation is available. For more detail on self-employed add-backs explained, read our dedicated guide.
What Is a Low Doc Home Loan?
A low documentation (low doc) home loan uses alternative income verification instead of tax returns. Common evidence types include:
- BAS statements — last 4 quarters (or 12 monthly) showing GST turnover, lodged with the ATO
- Business bank statements — 6 months of business account showing deposits and cash flow
- Accountant's declaration — a signed letter from a registered CPA or CA certifying your income
Low doc loans typically carry a rate loading of 0.20%–0.80% above standard rates and are restricted to lenders who have specific low doc products. LVR is generally capped at 80%. Read our full low doc guide for more detail.
| Factor | Full Doc | Low Doc |
|---|---|---|
| Income proof | Tax returns + NOA | BAS / bank stmts / letter |
| Max LVR | 95% (with LMI) | 80–85% |
| Rate premium | None | +0.20–0.80% |
| Major bank access | Yes | Limited |
| ABN history needed | 2 years (lodged returns) | 12 months minimum |
| Best for | Strong returns, high declared income | Low declared income, new ABN |
When Full Doc Is the Better Choice
Full doc is almost always preferable when you qualify. Choose full doc when:
- 2 years of solid tax returns are lodged — particularly if net profit after add-backs shows strong income
- You want the lowest possible interest rate — the rate premium on low doc can cost tens of thousands over the loan term
- You're borrowing above 80% LVR — most low doc lenders cap at 80%; full doc allows up to 95% with LMI
- You want access to the widest lender choice — all major banks and most second-tier lenders offer full doc; low doc is limited to a subset
- You're buying in a regional or specialist postcode — some low doc lenders have postcode restrictions that don't apply to full doc
When Low Doc Is the Better Choice
Unlock the Low Doc Decision Guide
See exactly when low doc beats full doc — plus get a free personalised assessment from our specialist team.
The Hybrid Approach
Some lenders use a combination of documentation — for example, one year of tax returns plus 4 quarters of BAS statements. This "hybrid" or "alt doc" approach can sometimes qualify borrowers who don't fully fit either the pure full doc or pure low doc category.
- Common with second-tier lenders and some non-bank specialists
- Can provide better rates than pure low doc
- Useful for borrowers with one strong year of returns plus current BAS evidence
- Requires a broker with knowledge of which lenders accept hybrid documentation
Calculate Your Borrowing Power
Our borrowing power calculator gives you a starting estimate. For a full lender-specific assessment under both full doc and low doc scenarios, speak with our specialist team — it's free and there's no obligation.
Frequently Asked Questions
Ready to talk to a broker?
Get a straight answer about your borrowing power — no credit check, no obligation. Our Sydney mortgage broker team is available Mon–Sat 9am–7pm.