Low doc vs full doc vs no doc asset finance
Someone asked me once whether they needed two years of tax returns for a truck loan.
They'd almost talked themselves out of applying.
The answer was no, and it usually is.
That conversation is why this article exists, because the "low doc" and "full doc" labels scare people into thinking they need paperwork they don't.
Key Takeaways
Which one should I use? Low doc is usually the sweet spot for most businesses that need the asset fairly quickly.
Do I need two years of tax returns? No. Lenders rarely ask for them up front.
Is no doc worth it? Usually not, because you'll pay more than you need to. But also there’s no such thing as zero documentation. There’s always something, even a credit check.
When is full doc better? For a larger asset or a fleet, where a sharper rate is worth the extra paperwork.
What's the difference between low doc, full doc and no doc?
Full doc means the full financial picture: tax returns, financials, the lot. It's thorough, which is exactly why a lender can offer a sharper rate on it. The trade-off is time and the risk that the lender finds something in the detail they don't like.
Low doc means enough to prove the business is real and can pay: recent BAS statements, bank statements, an ABN and GST registration. It's our default, because it gets you a sharp rate without opening your whole file to scrutiny.
No doc means little to no documentation at all. It kinda exists, but we rarely use it, because the rate is always higher than it needs to be and there's no reason to pay more than you have to.
Think of it as a slider. More paperwork usually means a sharper rate and a slower process. Less paperwork means faster, but you pay for the convenience. Low doc sits in the middle, which is why it's where most deals land.
Why do we usually go low doc?
Because it's the point on the slider where the maths works out best for you.
Low doc lets us request the right amount of information to get you a sharp rate, without risking the deal stalling. A full doc application takes longer and, more importantly, opens the door to a lender finding something in your financials they don't like and refusing on the back of it. Once this happens we can be in all sorts of problems.
There's a second reason, and it's the one most people don't know. Some lenders will reject you if they can see two or more credit inquiries in the last 30 to 60 days. That means you want to get the application right the first time, with the right amount of paperwork, rather than submitting, getting knocked back, and shopping around. We're careful about which lender we approach first for exactly this reason.
Do I need two years of tax returns?
No. Not usually, and certainly not up front.
Lenders aren't sitting there waiting for two years of tax returns before they'll talk to you. They may ask for ATO portal access or bank statements, but the classic "two years of financials" requirement people fear is the exception, not the rule.
If a lender does want financials, it's usually because it's a larger asset (i.e. $500k+), a longer purchase, or the file needs the extra proof. In those cases full doc is the right call anyway, and we'll tell you before you invest the time.
When is full doc the better choice?
Full doc earns its keep when the deal is big enough that a sharper rate matters more than the time.
If you're buying a larger asset or a fleet of assets, and you've got a bit more time to get it done, I'll push toward full doc. The paperwork is heavier, but on a big number the sharper rate and the better operating term more than pay for it.
It's not about full doc being "better". It's about it being the right tool for a bigger, slower, more considered purchase.
What happens if a lender queries my application?
This is where the broker's job matters most.
When a client is new, or they're stretching to get a bigger asset and their ducks aren't all in a row, a lender will query the application. If the lender doesn't like the answer, they'll ask for more, usually bank statements. And if those bank statements don't look great, the deal can stall.
Our job is to avoid that. At Stacked Finance, we present the picture properly the first time, so the lender doesn't need to come back asking questions. The right structure, the right amount of documentation, and the right lender are what keep a low doc application from turning into a full doc one halfway through.
What should I have ready before I apply?
Keep it simple, and we'll tell you exactly what's needed once we know the deal. New business? The rules shift a little, so have a look at asset finance for a business under 12 months old.
For most low doc applications, that's your ABN, GST registration, recent BAS statements, and recent bank statements. If you're trading as a company or a trust, we'll need the structure details too. If the asset is larger and we're going full doc, we'll ask for financials at that point, not before.
Moral of the story is to just be upfront with us from the beginning and we’ll do the heavy lifting for you.
What next?
If you've been holding off because you thought you'd need a folder full of financials, don't. Tell us what you're buying and what you can provide, and we'll tell you the lightest documentation that still gets you a good deal on asset finance.
General information only. This article provides general information and does not take into account your objectives, financial situation, or needs. Stacked Finance Pty Ltd is a credit representative under Viking Asset Aggregation and provides commercial finance services only. Consider whether the information is appropriate for your circumstances and seek advice from your accountant or financial adviser before acting.
Frequently Asked Questions
What is the difference between low doc and full doc asset finance?
The amount of documentation. Full doc needs tax returns and financials; low doc needs BAS statements and bank statements. Full doc usually gets a sharper rate, low doc is faster.
What documents do I need for a low doc loan?
Usually your ABN, GST registration, recent BAS statements and recent bank statements. We'll confirm the exact list once we know the asset and your structure.
Can I get a no doc business loan in Australia?
Yes, but we rarely recommend it, because the rate is higher than it needs to be and low doc usually achieves the same outcome for less.
Is low doc finance more expensive than full doc?
It can be, because the lender is taking on more without the full financial picture. That's why full doc suits bigger purchases where the sharper rate is worth the paperwork.
Do I need financials for equipment finance?
Not usually. Most equipment finance goes through low doc with BAS and bank statements. Financials only come into it for larger or more complex deals.
Ready to finance your next asset?
Tell us what you are after and we will come back with the lenders that fit.
Luciano Viterale is a Director and the Head of Growth at Stacked Finance. He previously co-founded and sold Ticker Nerd, an investing newsletter. Before that, he worked for Rippling, Finder, and the Reserve Bank of Australia. These days, he helps Aussie business owners grow through better finance options.