Following the latest economic recession, most countries like the United States and countries in Europe did not recover as well as the Australian economy. However, the Australian small businesses felt the worst of the after effects since they found themselves out of the global recession with very little capital to use having spent all of their capital to last through the global recession. The biggest problem facing small business was their lack of current tax statements to prove their income when they went to try and get a small businnes loan. Since they couldn't prove their income, they didn't qualify for a small business loan from banks. They became the hardest hit of the global economy melt-down.
These failed small businesses could have applied for a low doc loan. A low doc loan requires only verification of income rather than past tax statesments to get a small business loan. The low documentation loan was a bustling business in Australia. It has shrunk during the past three years because of more stringent credit laws governing refinancing and consolidation of debt.
Besisdes the stricter credit laws there is another problem than has limited the availability of low doc loans. Credit lenders ike Bluestone and GE Money were also affected by the global economic situation and had to close. These credit lenders were not bank affiliated lenders who made money available for special creditors like small businesses.
However, there are still special credit lenders who offer low doc loans. These experienced credit lenders are satisfying a growing demand from small businesses and from self employed people to get credit. The fact is that they couldn't continue with their small business or with their self employment work unless they get a business loan. The strength of small business and self employed is very important to the Austrialian economy. They are the self employed small businesses that work as hairdressers, tradesmen, and providers of services vital to the Austrailian financial success. Their success is contingent on their access to low doc loans which has made these loans again popular and easier to get.
While loc doc loans are available they are not as easy to access as conventional bank loans since low documentation lenders are not bank lenders. They are available and the consumer can feel assured that they will be as safe getting a low doc loan as they would feel getting a conventional bank loan since they have to comply with a new law passed on the 1st of July, 2011. That law that protects creditors from lenders is called the National Consumer Credit Protection Act. The law was the result of investigations done by federal and state governments through the years that ended with the successful passage of the new Act that governs territories as well as states in regards to how credit is to be given and repaid.
The Act lists requirements that credit lenders including low doc loan lenders must follow when giving a loan. It is meant as a consumer protection law which gives the credit more protection from lenders than ever before. The new Act protects consumers who get loans from banks and from lenders who are not affiliated with banks like the special lenders who made low doc loans available for small businesses and for the self employed.