Investor activity surged through 2025, with the Australian Bureau of Statistics reporting a 31.8 percent jump in investment lending and a record number of new loans. NSW investors took out loans averaging $873,000, highlighting renewed confidence.
For low‑doc borrowers – typically self‑employed or small business owners – this surge brings opportunities and challenges. As the market heats up, lenders remain cautious, and new debt‑to‑income limits and serviceability buffers mean documentation and planning are more important than ever.
Keep reading for:
- Why investor lending is booming again and what the statistics tell us
- A plain‑English definition of low‑doc home loans and who they suit
- Your 2026 lender checklist: the documents and evidence you’ll need
- How APRA’s 3 percent buffer and new DTI cap affect borrowing power
- A seven‑day plan to gather everything quickly
Quick answer
- Investment lending jumped more than 30 percent in 2025, with average loan sizes rising, especially in NSW.
- Low‑doc home loans are designed for self‑employed borrowers who can demonstrate income through business statements and BAS rather than payslips.
- Most low‑doc loans require at least a 20 percent deposit, a solid credit history and evidence of business cash flow.
- APRA requires lenders to assess your loan using a 3 percent serviceability buffer and, from February 2026, high debt‑to‑income loans will be limited to 20 percent of new lending.
- Planning ahead – and gathering documents in a systematic way – is essential to stay ahead in a competitive investor market.
What’s behind the investor lending comeback?
Investor confidence returned in 2025, with new investment loans totalling $42.9 billion in the December quarter and the number of loans up 23 percent year‑on‑year.
- Average investor loan size nationwide reached $717,000; in NSW it topped $873,000
- The growth accelerated mid‑year as interest rates fell and property prices rose
- Investor demand has remained strong despite a modest rate rise in early 2026
- More investors are competing for stock, leading to higher purchase prices and faster sales
This momentum means low‑doc borrowers should be prepared for competitive conditions and ensure their finances stack up.
Discuss your investment goals with our investment lending support specialists to position yourself ahead of the pack.
What does “low‑doc” really mean?
A low‑doc home loan isn’t a no‑doc loan – it simply allows self‑employed borrowers to prove income without standard payslips (see the Moneysmart home loans guide for more details).
- Borrowers usually need an ABN and at least 12 months of trading history
- Evidence may include business bank statements, BAS and tax returns
- Lenders assess credit history and may require an accountant’s declaration
- Low‑doc loans often come with higher interest rates and stricter terms
Understanding the documentation needed prevents delays and improves your chances of approval.
Read more about low‑doc loans or get in touch to see if this option suits you.
Your 2026 lender checklist
Lenders are more willing to finance investors again, but they expect well‑prepared applications.
- Valid ABN and proof of trading history
- Business and personal bank statements covering at least the last six months
- BAS and tax returns for the past year or two
- A deposit of 20 percent or more and evidence of savings
- A clear credit report and limited existing debt
Meeting these requirements helps you access competitive rates even as investor demand picks up.
Our investment lending support team can review your documents and highlight any gaps.
How do buffers and DTI rules affect you?
Lenders must assess your ability to repay using an interest rate at least 3 percentage points above the actual rate and will soon limit high debt‑to‑income lending.
- APRA’s 3 percent serviceability buffer remains in place to ensure borrowers can withstand rate rises
- From February 2026, only 20 percent of new mortgages can have a debt‑to‑income ratio of six or more
- Borrowers with higher leverage or multiple properties may face closer scrutiny
- Preparing for a slightly higher assessment rate can avoid surprises
These rules are designed to protect borrowers and the financial system, but they mean your borrowing capacity might be lower than you expect (see Housing Australia’s Home Guarantee Scheme for deposit support).
If you’re unsure how the buffer or DTI cap applies to you, speak with us for a personalised assessment.
A seven‑day document gathering plan
Organising your paperwork efficiently can make all the difference in a competitive market.
- Day 1: Download recent business bank statements
- Day 2: Collect BAS and tax return copies
- Day 3: Request an accountant’s declaration of income
- Day 4: Obtain a copy of your credit report and check for errors
- Day 5: Collate evidence of your deposit and any other assets
- Day 6: List existing debts and organise proof of repayments
- Day 7: Meet with your broker to review and finalise your application
Following a step‑by‑step plan reduces stress and demonstrates to lenders that you’re organised.
Download our checklist or book a call with us to go through your low‑doc application step by step.
Quick reality check
Low‑doc loans aren’t a shortcut – lenders still verify your income and may charge higher interest rates.
You’ll generally need a larger deposit than with a traditional loan; 20 percent is a common minimum.
APRA’s 3 percent buffer and DTI cap mean your borrowing capacity may be lower than headline rates suggest.
Low‑doc loans suit borrowers with stable business income; if your income is unpredictable, consider waiting or improving documentation. If you’re experiencing financial hardship, Services Australia offers assistance.
Always compare offers and seek advice; our experts can help you understand which lender policies align with your situation.
| Document | Why it matters | Easy way to prepare |
| Bank statements | Show cash flow and business performance | Download the last 6 months from your online banking portal |
| BAS | Verify turnover and GST obligations | Print or save PDF copies from the ATO portal |
| Tax returns | Evidence of income and deductions | Obtain signed copies from your accountant |
| Accountant’s letter | Confirms your financial position | Request a signed declaration on letterhead after providing your figures |
The resurgence of investor lending offers opportunities for self‑employed borrowers, but preparation is vital.
By understanding low‑doc requirements, gathering your documents systematically and being mindful of buffers and DTI rules, you can position yourself confidently.
For tailored guidance on low‑doc and investment lending in NSW, contact our team today. Learn more about our approach on our About page.