Getting Pre-Approved for your Home Loan

When you’re preparing to buy a property, understanding your finance position can help you approach your search with greater confidence.

I’ll help you decide whether pre-approval is a useful next step, understand what it means and work through the lender’s requirements.

1. Understand what pre-approval means

Pre-approval gives you an indication of what a lender may be prepared to lend, subject to conditions. It can help you establish a potential price range and focus your property search.

It is conditional and does not guarantee final loan approval. The lender still needs to assess the property and confirm that its requirements are met. MoneySmart explains how pre-approval fits into buying a home.

I’ll explain what has been assessed and what remains to be confirmed.

2. Decide whether the timing is right

Pre-approval can be useful when you’re preparing to look seriously for a property. We’ll discuss your plans, likely timing and financial position before deciding whether to apply.

You can speak with me well before you reach that point. Our initial conversation can help identify what needs to happen first.

A pre-approval application involves a credit check. We’ll discuss the application process and any fees that may apply before proceeding. More about applying for conditional approval.

3. Prepare the information the lender needs

The information required depends on your circumstances and the lender. It may include:

• Identification
• Evidence of income and employment
• Savings and deposit information
• Living expenses, existing loans and other commitments

I’ll provide a clear list of what is needed and help you work through it. Once you’re ready to proceed, I’ll prepare the application, liaise with the lender and keep you informed.

4. Understand the conditions and expiry

Your pre-approval has a limited period of validity and conditions that need to be understood.

I’ll confirm what applies to your approval, including its expiry date and any outstanding requirements.

If you haven’t found a property before it expires, we’ll discuss the next steps with the lender. Updated documents and a further assessment may be required.

5. Keep your financial position up to date

While you’re looking for a property, let me know about changes to your income, employment, expenses, deposit or existing debts.

New borrowing or changes to credit limits may also affect your finance position.

Keeping me informed allows us to review the potential impact and check whether your pre-approval needs to be reassessed.

6. Move towards final approval

Once you’ve found a property, I’ll help you work through the next stage of the application.

The lender will need to assess the property, which may include a valuation, and complete its remaining checks. The time required will depend on the application and the lender.

Before signing a purchase contract or bidding at auction, speak with me about your finance position and obtain advice from your solicitor or conveyancer about the contract, conditions and deadlines. MoneySmart’s home-buying guide explains these steps.

I’ll keep you informed about what is outstanding and what happens next.

Let’s work out your next step

Whether you’re local or interstate, we can work together over Zoom.

Book a 15-minute phone call, and we’ll discuss your plans and whether pre-approval would be useful for you.