Expected Read Time: 7 min read
Quick Summary / TL;DR
- The 2026 Shift: Major lenders like ING and Westpac have significantly updated their policies, making it easier for self-employed Perth residents to borrow.
- One Year is Enough: You no longer necessarily need two years of tax returns; some lenders now accept a single year of strong financials.
- Profit Recognition: If you own 50% or more of your company, lenders are now more willing to recognize your share of business profits as personal income.
- The Shadow Collateral Play: Lack of a cash deposit? You can use equity in an existing property (even if it’s currently a commercial asset) to secure a residential loan.
- Perth Advantage: Our local market remains resilient, but the window for “business-friendly” lending rates is tightening.
The New Era of Entrepreneurial Lending in Perth
If you are running a business in Perth in 2026, you know the drill. The coffee is expensive, the weather is perfect, and the property market is absolutely flying. But for years, the “Big Banks” treated entrepreneurs like we were speaking a different language.
Traditional lenders used to demand two, sometimes three years of flawless tax returns before they’d even let you through the door for a home loan. For a scaling startup or a growing trade business, that felt like an eternity.
However, as we move through 2026, the goalposts have shifted. At Baseline Finance, we’re seeing a massive pivot in how lenders view business owners. The rigid barriers of the past are being replaced by a more pragmatic, data-driven approach to risk.
Lenders Moving Goalposts: The ING and Westpac Shift
In early 2026, we saw a significant policy pivot from major players like ING and Westpac. They realized that the “two-year rule” was excluding some of the most credit-worthy individuals in Western Australia: the business owners driving our economy.
Instead of demanding a multi-year history that might not reflect your current success, these lenders have begun adopting a “most recent year” approach.
Why 1 Year of Financials is the New Gold Standard
For many entrepreneurs, the first year of a business is about survival, and the second is about growth. If your 2024 was “just okay” but your 2025 was a record-breaker, the old way of averaging two years would drag your borrowing power down into the dirt.
By focusing on the most recent 12 months of financials, lenders are finally acknowledging the “runway” of modern businesses. This is particularly useful for Perth-based contractors and consultants who have recently transitioned from PAYG to their own ABN.
Recognizing Company Profits for 50%+ Owners
One of the biggest frustrations for business owners has always been “The Dividend Dilemma.” You might be sitting on hundreds of thousands of dollars in company profit, but if you only paid yourself a modest $80,000 salary for tax efficiency, the bank would only see that $80,000.
In 2026, the landscape looks different. If you own 50% or more of the business, a growing number of lenders will now “add back” your share of the net profit before tax to your personal income.
The “Add-Back” Math
Lenders look at more than just your salary. They now frequently include:
- Depreciation: That non-cash expense for your equipment? It’s added back to your income.
- One-off Expenses: Did you buy a new fleet of utes last year? Lenders can often treat that as a one-off cost, not a recurring drag on your income.
- Superannuation: Voluntary contributions above the guarantee can be added back.
This change alone can often double an entrepreneur’s borrowing capacity overnight.
The ‘Shadow Collateral’ Play: No Deposit, No Problem?
Let’s be honest: in the current Perth market, saving a 20% deposit while also reinvesting every spare cent into your business is a nightmare. This is where the ‘Shadow Collateral’ strategy comes into play.
If you already own a property: be it a small commercial warehouse in Osborne Park or a residential investment in Joondalup: you don’t necessarily need cash.
Using Existing Property as Security
Instead of a liquid cash deposit, you can use the equity in another property as security for your new home loan.
“In 2026, equity is the new cash. If you’ve seen growth in your commercial assets, we can often leverage that to get you into a residential home with zero out-of-pocket deposit.” : Bradley Smith, Baseline Finance.
This approach involves the bank taking a “cross-collateralized” or “second mortgage” position. While it requires a strategic structure to avoid future complications, it is the fastest way for business owners to scale their personal property portfolio without draining their working capital.
Comparing Your Options: 2026 Lender Overview
| Lender Type | Documentation Required | Min. ABN Age | Key Advantage |
|---|---|---|---|
| Major Banks (e.g. Westpac) | 1-2 Years Tax Returns | 2 Years | Lowest Interest Rates |
| Challenger Banks (e.g. ING) | 1 Year Tax Returns | 2 Years | Fast Processing / Tech Driven |
| Non-Bank/Alt-Doc | BAS or Accountant’s Letter | 6-12 Months | Maximum Flexibility |
| Specialist Lenders | Bank Statements Only | 6 Months | Speed and High LVR |
Navigating the Perth Property Landscape
Perth remains a unique beast. While Sydney and Melbourne struggle with affordability, the Perth market has maintained a steady “expert advisor” persona: it’s rational, but it’s moving fast.
For entrepreneurs, location choice is often about more than just a lifestyle; it’s about investment fundamentals. Whether you’re looking at the blue-chip stability of Dalkeith or the emerging growth in Alkimos, your loan structure needs to reflect your long-term business goals.
Strategic Funding Plan: The Baseline Difference
At Baseline Finance, we don’t just “find a rate.” We provide a Strategic Funding Plan within 7 days. This is a comprehensive roadmap that benchmarks your business performance against current lender appetites. We act as your single point of contact, handling the paperwork while you handle your business.
Your 5-Step Runway to a 2026 Mortgage
- Clean up the Ledger: Ensure your director loan accounts are tidy. Lenders hate seeing personal expenses masquerading as business costs.
- The 12-Month Snapshot: Get your 2025/2026 tax returns prepared early. Even if you haven’t lodged them yet, draft financials can help with “scenario testing.”
- Audit Your Equity: Get a desktop valuation on any existing property you own. You might have more “Shadow Collateral” than you realize.
- Check Your ABN: Ensure your ABN and GST registration dates are correct. Even a one-day difference can sometimes trigger a policy rejection.
- Engage a Specialist: Standard mortgage brokers often struggle with complex company structures. You need someone who understands Acquisition Finance and Working Capital.
Glossary: Terms Every Entrepreneur Should Know
- Alt-Doc (Alternative Documentation): A loan for self-employed people that uses bank statements or accountant declarations instead of full tax returns.
- LVR (Loan to Value Ratio): The amount you are borrowing compared to the value of the property.
- Add-Backs: Business expenses that a lender “adds back” to your profit to show your true earning capacity.
- Servicing: The bank’s calculation of whether you can afford the monthly repayments.
- Shadow Collateral: The use of existing property equity to secure a new loan in lieu of a cash deposit.
Ready to secure your Perth home?
Navigating the mortgage market as a business owner shouldn’t feel like a second job. We provide jargon-free, honest advice to help you secure the funding you need.
Contact us on 08 6108 3925 or email commercial@baselinefin.com.au to start your Strategic Funding Plan today.
