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What are No Doc Loans?

No Doc Loans are loans than require less paperwork than Low Doc Loans.

There is no such thing as a completely No Doc Loan.

No Doc Loans are generally loans that are in a company name that are not regulated by the NCCP.

They still require documentation and an indication as to how a loan is to be repaid.

As a guide, instead of an accountants letters and, or BAS, documentation may take the form of a completed application form outlining assets and liabilities and bank statements of all loans evidencing ability to repay a loan.

What lending is regulated under the National Credit Code?

How is it determined if a particular loan will be “regulated” or “non-regulated” under the National Credit Code (NCC)?

Section 5 of the NCC details the credit to which the NCC applies, while Section 6 details the credit to

which the NCC does not apply.

As a guide and guide only, there are two main tests.

1/ Entity

2/ Purpose

Is a borrower an individual (or a group of individuals) or a strata corporation?

Yes, then the loan may be regulated under NCCP (see purpose)

No, then the credit is not regulated. ie if the borrower is a company, a loan is not regulated under NCCP.

Is the credit is wholly or predominantly (> 50%) for:

a.    Personal, domestic or household purposes? or

b.    for purchasing, renovating or improving residential property for investment purposes?

c.    or for refinancing credit that was provided wholly or predominantly (> 50%) for the purchase, renovation or improvement of residential property for investment purposes?

If any of the answers to (a), (b) and (c) are “yes “, then the loan is regulated.

Category: Credit

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