Buying a house when you work for yourself involves proving your income differently than wage earners.
Lenders want to see that your painting business generates consistent cash flow, not just that you had one big year followed by a lean one. Most will ask for two years of tax returns, but the right lender will look at your circumstances properly rather than just tick boxes.
What Documents You'll Need for a Home Loan Application
You'll provide two years of tax returns including your Notice of Assessment from the ATO. Lenders use these to calculate your declared income, which becomes the basis for borrowing capacity. If you've claimed depreciation on tools, vehicles, or equipment, some lenders will add this back to your income because it's a paper expense, not actual money leaving your account.
You'll also need recent bank statements showing at least three months of transactions, your ABN registration, and proof of any contracts or ongoing work. If you've got a business account, provide those statements too. Lenders want to see how money moves through your business, not just what you declared at tax time.
Consider a painter who earned $92,000 in their most recent financial year and $87,000 the year before. They claimed $14,000 in depreciation on their van and spray equipment. A lender that understands self-employed loans for tradies would assess their income at around $99,000 after adding back non-cash deductions. That difference can mean an extra $50,000 to $70,000 in loan amount depending on other commitments.
How Much Deposit You Actually Need
Most lenders want a 20% deposit to avoid Lenders Mortgage Insurance, but painters don't always need to wait that long. A 10% deposit puts you in the LMI zone, which adds a one-off premium to your loan. On a $500,000 purchase with a 10% deposit, LMI might cost $8,000 to $12,000 depending on your lender and loan to value ratio.
Some lenders offer LMI waivers for certain occupations, though painters don't typically qualify for these unless you're working through specific industry programs. If you've got less than 10% saved, look into the 5% deposit scheme for tradies, which caps LMI and opens up buying your first home sooner.
Your deposit needs to come from genuine savings or equity in another property. Lenders won't accept borrowed money as a deposit. If your parents want to help, a genuine gift with a signed declaration works. If they're guaranteeing part of the loan, that's a different structure altogether.
Variable Rate vs Fixed Rate: What Works for Painters
A variable rate moves up and down with the market. You pay what the lender sets, but you also get flexibility to make extra repayments without penalty and access features like an offset account. An offset account is a transaction account linked to your home loan where the balance reduces the interest you pay. If you've got $30,000 sitting in offset against a $450,000 loan, you only pay interest on $420,000.
A fixed interest rate home loan locks your rate for one to five years. You'll know exactly what your repayment is, which helps with budgeting when your income fluctuates seasonally. The trade-off is limited extra repayments and break costs if you need to refinance or sell before the fixed period ends.
A split loan gives you both. You might fix 60% of your loan for three years and keep 40% variable with an offset account attached. That way you've got payment certainty on the bulk of the debt and flexibility on the rest. In our experience, this setup works well for painters who get lumpy income from commercial contracts followed by quieter periods.
Ready to get started?
Book a chat with a Finance & Mortgage Brokers at Tradie Home Loans today.
Home Loan Pre-Approval: Why It Matters
Pre-approval tells you what you can borrow before you start looking at properties. A lender assesses your income, expenses, deposit, and credit history, then gives you conditional approval for a loan amount. This usually lasts 90 days, though some lenders will extend it.
Without getting loan pre-approval, you're guessing at your budget. You might fall in love with a $650,000 property only to find out lenders will only lend you enough for a $550,000 purchase. Pre-approval also shows real estate agents and vendors you're a genuine buyer, which matters in any market where multiple offers come in.
Pre-approval is conditional. It's based on the information you've provided and assumes nothing changes before settlement. If you take on a car loan, change jobs, or your credit score drops, the lender can withdraw the approval.
Principal and Interest vs Interest Only Repayments
Principal and interest repayments are standard for an owner occupied home loan. Each payment covers the interest charged that month plus a portion of the loan amount. Over time, you build equity and eventually own the property outright.
Interest only means you only pay the interest each month. The loan amount doesn't reduce. This keeps repayments lower in the short term but means you're not building equity. It's mostly used for investment properties where you want to maximise tax deductions and cash flow, not for the home you live in.
Some painters use interest only when cash flow is tight during a business expansion or slow season, then switch back to principal and interest once things stabilise. That strategy only works if you've got a solid plan to pay down the debt later. Otherwise, you're just delaying the inevitable and paying more interest over the life of the loan.
What Happens Between Approval and Settlement
Once your loan is formally approved, the lender books a settlement date with the vendor's legal team. This is usually four to six weeks after you sign the contract of sale. Your conveyancer or solicitor handles the legal paperwork, including title searches, contract reviews, and liaising with the lender.
You'll need to organise building and pest inspections before the cooling-off period ends. If the inspector finds structural issues or termite damage, you can renegotiate or walk away depending on your contract terms. Don't skip this step to save a few hundred dollars. We regularly see buyers stuck with $40,000 repair bills they didn't budget for.
The lender will order a property valuation to confirm the purchase price matches market value. If the valuation comes in lower than your offer, the lender will only lend against the lower figure. You'll need to cover the difference with extra deposit or renegotiate the sale price.
On settlement day, your lender transfers the loan amount to the vendor's solicitor. You transfer your deposit and any additional funds needed to complete the purchase. Once that clears, you get the keys. Your first mortgage repayment will be due about a month later, depending on the lender's cycle.
Call one of our team or book an appointment at a time that works for you. We'll look at your actual income, not just what a computer says, and connect you with lenders who understand how painters earn their money.
Frequently Asked Questions
What documents do self-employed painters need for a home loan?
You'll need two years of tax returns with ATO Notices of Assessment, recent bank statements covering at least three months, ABN registration, and proof of ongoing contracts. Lenders may also ask for business bank statements to see cash flow separate from your personal accounts.
Can painters get a home loan with a 10% deposit?
Yes, a 10% deposit is enough but you'll pay Lenders Mortgage Insurance, which typically costs $8,000 to $12,000 on a $500,000 property. Some schemes allow deposits as low as 5% for eligible buyers.
Should painters choose a variable or fixed rate home loan?
A split loan often works well for painters because it combines payment certainty on a fixed portion with flexibility on a variable portion linked to an offset account. This handles seasonal income fluctuations while keeping some budgeting predictability.
What happens between loan approval and settlement?
Your conveyancer handles legal paperwork while you organise building and pest inspections. The lender orders a valuation to confirm property value, then transfers the loan amount on settlement day. You'll receive keys once funds clear, with your first repayment due about a month later.
Do lenders add back depreciation for self-employed painters?
Some lenders will add back depreciation on tools, vehicles, and equipment because it's a non-cash deduction. This can increase your assessed income and borrowing capacity compared to lenders who only use your declared taxable income.
