The situation
This is an anonymised composite reflecting a common pattern, not a specific settled deal. A tradesperson leaves employment to start their own business, registering a new ABN, and within the first year identifies a small commercial premises to purchase for their operations rather than continuing to rent. Their financials do not yet exist in a form a full-doc lender would recognise, since the business itself is barely a year old.
Why it's hard
Most full-doc lenders want two to three years of financial statements and tax returns demonstrating consistent income, which a business this new simply cannot produce, regardless of how strong its actual trading position is. A new ABN is also, in isolation, read by many lenders as a higher-risk signal, even where the underlying trade or profession has a long personal history behind it.
How it can be structured
A low-doc commercial loan assessed against a signed income declaration, supported by BAS statements covering the trading period so far and bank statements showing turnover, is the standard path, generally at a somewhat lower loan-to-value ratio than a full-doc facility would offer; the exit is ordinary loan servicing from the business's trading income over the facility's term. Where the borrower has a long personal trading history in the same trade prior to registering the new ABN, for example years as an employed tradesperson before going out on their own, presenting that history alongside the new business's early results can strengthen the file considerably, even though it is not part of the formal serviceability calculation. A shorter-term facility with a planned refinance to full-doc terms once two full years of financials exist is also a common structure, treating the low-doc facility as a bridge to better long-term pricing.
Lenders will typically look for consistency across all the documents submitted, with BAS figures aligning with bank statement deposits and the income declaration itself being plausible for the trade or profession involved, since a mismatch between these sources is one of the more common reasons a low-doc application is declined rather than simply approved at a lower amount. Where the new ABN reflects a change in structure rather than an entirely new trade, such as a tradesperson moving from a partnership to a sole trader structure, providing the prior entity's trading history alongside the new ABN's early results gives the lender a fuller picture than the new ABN's limited history would show alone. Some lenders will also request a letter from the borrower's accountant confirming the business is trading soundly and the declared income is reasonable, which, while not a full financial statement, adds a further layer of independent support to the application. A slightly larger deposit than a full-doc purchase might otherwise require is common in this category, reflecting the reduced verification and generally improving the terms available.
What it typically costs
Pricing on a low-doc facility is modestly above an equivalent full-doc rate, reflecting the reduced income verification, quoted on enquiry once a lender has reviewed the declaration and supporting BAS or bank statements. Establishment costs are broadly standard for commercial property lending.
Timeline
- Same day — scoping call confirming the business's trading history, BAS lodgements and the property.
- 2–5 business days — document collection and declaration preparation.
- 5–10 business days — lender submission and credit approval.
- 5–10 business days — settlement.
Questions we'd ask you
- How long has the ABN been registered, and how many BAS statements have been lodged so far?
- Do you have a personal trading history in the same industry prior to this ABN?
- What does recent bank statement turnover show for the business?
- What deposit or equity are you contributing toward the purchase?
- Would you consider refinancing to full-doc terms once two full years of financials are available?
Related
Low-doc commercial loans · Self-employed low-doc borrowers · Low-doc · BAS