Home Loans Self-Employed Under 2 Years: How to Secure a Construction Loan with Limited Trading History

If you’re self-employed and just getting started, say, under two years in business, you might assume a home loan is out of reach. And when you add construction into the mix? Most banks will tell you it’s a no.

But that’s not the full story.

Specialist lenders and certain mortgage brokers now offer workarounds for exactly this group: people with growing income, strong cash flow, but not enough paperwork to satisfy traditional rules.

This article explores how home loans self-employed under 2 years work, especially when you’re trying to build. We’ll also highlight what brokers in cities like Sydney and Melbourne can do to improve your approval odds.

Why Most Lenders Want Two Years of Tax Returns

The standard checklist for a self-employed applicant looks like this:

●     Two full years of tax returns

●     An active ABN (often two years old or more)

●     A GST registration

●     Profit and loss statements verified by an accountant

●     Business bank statements

That’s fine if you’ve been trading for a while. But what if you’ve only been self-employed for 12–18 months? That’s where low-doc and alt-doc loans come into play.

The Low-Doc Option: How It Works

Low-doc or alt-doc home loans let you verify your income using alternatives like:

●     BAS statements

●     6–12 months of business bank statements

●     A letter from your accountant

●     Interim financials

This is especially useful for contractors, sole traders, or directors who reinvest profits back into their business and don’t show big personal income on paper.

The catch? You’ll need:

●     A larger deposit (usually 20–30%)

●     Clean credit history

●     Consistent income flow

●     A broker who knows which lenders are comfortable with home loans for self-employed under 2 years

Construction Loans: The Extra Layer of Scrutiny

If you're building your home instead of buying an existing one, lenders get even more conservative. They want to know:

●     That you can afford progress payments

●     That the builder contract is fixed price

●     That your business will survive the full build time

●     That you’re not borrowing at the upper limit of your income

For this reason, most big banks won’t approve construction loans for self-employed borrowers with less than two years of trading history. But some specialist lenders will, if your deal is presented correctly.

What a Broker Does Differently in These Cases

This is where brokers earn their keep. A construction-savvy mortgage broker will:

●     Match you with lenders who consider <2 years ABN

●     Structure the loan to minimise interest exposure during construction

●     Package your file to highlight cash flow and job pipeline

●     Work with builders who meet lender compliance standards

●     Anticipate lender objections before submission

Instead of getting an automatic decline from a big four bank, a broker opens the door to non-bank and tier-two lenders who assess deals more flexibly.

How to Strengthen Your Application

If you're self-employed under 2 years and planning to build, you’ll need to get organised. Here’s what helps:

●     Provide 3–6 months of clean business bank statements showing income and expenses

●     Ask your accountant for a letter confirming trading history and projected income

●     Prepare a fixed-price building contract with a licensed builder

●     Have a deposit of 20% or more ready (some lenders will go as low as 15%)

●     Be upfront about any debt or irregularities, your broker can only solve problems they know about

What About First Home Buyers?

Yes, self-employed borrowers can still qualify for First Home Owner Grants and other state-based schemes. These don’t depend on your income type, just your property status and intent to live in the home.

In fact, some lenders that offer home loans for self-employed under 2 years also allow you to use the grant toward your deposit or cost base, reducing how much you need to save upfront.

Your broker will know which lenders treat the grant as genuine savings, and which won’t.

Why Loan Structuring Matters More Than the Rate

A 6.5% rate might look high on paper, but if it gives you the funding to complete a build while your business grows, it’s often worth it.

The key is to work with a broker who:

●     Knows how to stage drawdowns to avoid paying too much interest early

●     Prepares for what happens after the construction period (refinance or rate roll-over)

●     Understands how to prove your business viability to the lender’s credit team

This is a strategy game, not a quick comparison. And when your trading history is short, every decision matters more.

Specialist Lenders Who Consider <2 Years Trading

Here are a few lender types that may be open to your situation:

●     Non-bank lenders (e.g., Liberty, Pepper Money, RedZed)

●     Construction-specific lenders with flexible self-employed policy

●     Second-tier banks with alt-doc products and manual assessment teams

Each has different risk appetite, and rates tend to be slightly higher, but they give you a path forward when major banks say no.

A Better Path Than Waiting 12 More Months

Most people assume the only option is to wait until they hit the 2-year ABN milestone. But if your income is strong, your pipeline is stable, and your business is gaining traction, you might not need to wait.

You just need the right lending partner, and a broker who can explain your story properly.

Ready to build, even with limited self-employment history? Talk to the team at Loan Easy and let’s find a smarter way to finance your dream home.