A “No” from a traditional Bank is not the end of the road and that you are out of options.
There are alternative lenders, we refer to as ‘Non-Banks’ lenders, that can provide viable solutions when traditional Banks fall short.
If you achieve the required mortgage from a Non-Bank, you may then qualify in the future to potentially transition back to a traditional Bank.
Where Non-Bank Lenders Can Help
There are several situations where Non-Bank lenders can provide viable solutions.
These include:
Self Employed…
Self Employed individuals can come across challenges when seeking financing, as Banks want lots of information, whereas Non-Bank lenders tend to keep things simple.
They offer ‘Low Doc’ and ‘Alt Doc’ options, where they can accept as little as 6 months of business bank statements for Self Employed applicants. This flexibility makes it a lot easier for business owners and contractors to get a mortgage.
Other situations where Non-Bank lenders can help include:
- Poor credit history or previous defaults
- Overseas income sources
- Short term bridging finance
- Property Development projects
Credit Challenges…
For those with credit challenges, we know that Non-Bank lenders can have a more holistic approach to assessment.
Rather than simply declining applications based on credit scores, they work to understand the story behind past financial difficulties.
So, if you have had previous credit issues, you might still qualify for a loan.
What’s particularly helpful is their flexibility offered around income verification.
Non-Bank lenders can accept alternative documentation for this, which can suit:
- Commission based contractors
- Seasonal workers
- Small business operators
- Those with multiple income streams
While interest rates may be higher than traditional Bank rates, Non-Bank lenders often provide more negotiable terms for borrowers with good credit history. So, if your only issue to achieving a Bank mortgage is unconventional income or documentation, you may be able to secure competitive rates while benefiting from more flexible lending criteria.
We have multiple relationships with Non-Bank lenders and can match you with the most suitable option based on your specific circumstances.
Creating Your Way Back to Main Bank Lending
Obtaining a mortgage from a Non-Bank lender can provide immediate financing solutions. However, there are often opportunities for clients to transition back to traditional Bank lending.
We help our clients with planning so they can aim to successfully refinance back to a mainstream Bank. This is once the barriers are removed that prohibited them in the first place.
A ‘Bank Ready’ Profile
Banks require comprehensive financial records, including:
- Three months Bank statements
- Recent payslips or the last two years of business financials
- Evidence of assets and liabilities
- Proof of regular bill payments
Maintaining a clean credit record is very important.
Also, making consistent payments on your Non-Bank loan demonstrates reliability to future Bank lenders.
It’s also important to note that multiple credit applications can negatively impact your credit rating, so we can assist you with strategically timing your refinancing application back to a mainstream Bank.
Conclusion
Non-Bank lenders become a very viable option when traditional Banks don’t fit your needs.
These alternative lenders fill significant gaps in the market, especially when you have self-employment or unique financial situations.
Though interest rates might be higher than traditional Bank offerings, Non-Bank lenders provide essential steppingstones toward your financial goals.
Many clients successfully transition back to traditional Banks, through careful financial management and consistent payment history.
Remember, a “No” from a traditional Bank doesn’t mean the end of your borrowing journey. With the right approach and guidance, Non-Bank lenders can help you achieve your immediate financial needs, while building stronger banking relationships over time.
We understand these decisions may seem complex, so feel free to reach out if you need a hand navigating your options. Or just to have a chat about this, pick up the phone and call 0800 LENDER (536337) or email to [email protected]
