Comparison
Full Doc vs Low Doc Commercial Loans
Two of the most-quoted structures in Australian commercial lending — and the one most often miscategorised by accountants and residential brokers. Here is how the actual lender policy compares, and which structure wins in which scenario.
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Why this comparison matters
Most commercial borrowers default to full doc because their accountant runs that lane. But Australian SME tax structures — trust distributions, retained profits, working-capital draws — routinely understate true serviceability. A correctly structured low doc deal can deliver a higher approved loan amount than a full doc deal on the same asset, even though the headline rate is higher. The decision is not philosophical; it is arithmetic. Run both lanes and take whichever lands the deal you actually want.
What lenders mean by 'full doc' and 'low doc'
Full doc = two years of personal and entity tax returns, ATO portals, BAS, balance sheets, and a debt schedule. The lender computes serviceability from declared net profit, adjusted for one-offs. Low doc = the borrower (and usually accountant) certifies income; the lender substitutes BAS, bank statements, or a signed declaration. The asset, the loan purpose and the exit must be cleaner — lenders trade documentation depth for collateral quality.
Full Doc Commercial vs Low Doc Commercial
Side-by-side on the metrics commercial credit committees actually weigh.
| Attribute | Bank-grade pricingFull Doc Commercial | Self-employed friendlyLow Doc Commercial |
|---|---|---|
| Income evidence | 2 years tax returns + ATO + BAS | Accountant letter, BAS or 6 months bank statements |
| Headline rate | From ~6.5% p.a. | From ~7.5% p.a. |
| Max LVR (commercial) | 65–70% bank, up to 75% specialist | 65–75% specialist non-bank |
| Loan term | Up to 25–30 years | Typically 15–25 years |
| Approval timeline | 3–6 weeks | 5–15 business days |
| Application fee | Often nil with majors | 0.25%–1.5% capitalised |
| Best for | Established trading entities with clean financials | Self-employed, trust structures, recent restructure |
| Avoid when | Tax structure understates serviceability | Asset is non-standard or LVR > 75% |
When full doc is the right call
Choose full doc when your accountant-prepared returns genuinely reflect the cash the business generates, when you have at least two clean years, and when the asset is mainstream (office, industrial, retail in a metro postcode). The pricing differential to low doc is now ~75–150 bps; on a $3m loan over 20 years that is real money. Full doc also unlocks 25- and 30-year terms with several banks and non-banks, which materially reduces servicing pressure.
When low doc wins the deal
Choose low doc when you cannot evidence two years of returns at face value — recent restructure, post-COVID recovery, intentional tax planning, asset purchased in a new entity — or when speed matters and a 5–10 business day settlement is the difference between winning and losing the property. Low doc also wins when income is real but messy: multiple trusts, related-party rent, intra-group loans. Specialist non-banks underwrite this every day; majors do not.
Lender appetite right now
There are roughly 35 active full doc commercial lenders in Australia (four majors, ~10 second-tier banks, ~20 specialist non-banks) and roughly 25 active low doc commercial lenders, almost all non-bank. Bank low doc has largely disappeared post-Hayne. The non-bank low doc market has deepened — pricing has compressed ~150 bps over the last 24 months as institutional capital has chased commercial paper.
Full Doc Commercial vs Low Doc Commercial — FAQ
The questions sophisticated commercial borrowers ask when choosing between these two structures.