Pre-approval is a handy process wherein the bank assesses your loan eligibility in advance, as if you have lodged a full application.
Think you’ve got a deposit sorted? Fairly sure your calculations are correct on how much you can borrow? Don’t just wing it when making an offer on a property. Be certain with pre-approval.
Pre-approval is a handy process wherein the bank assesses your loan eligibility in advance, as if you have lodged a full application. They will confirm that your income, assets and liabilities have been accounted for and confirm what amount they would be willing to lend you.
The major difference between a pre-approval, sometimes called Approval in Principle (AIP) and a formal approval (or unconditional approval) is that you can get the former without having to list a property address as the security.
Applying for pre-approval
With so many options out there, it can be tricky deciding which lender will be most suited to you. This is where your broker comes in. We’ll go through your circumstances, including how your income is derived, where your deposit is sourced from, and even how your credit score could affect your application.
Your broker will be able to narrow down the right lender and product for you from the thousands of options floating around. Once you’ve chosen one, we’ll help you gather all of your verifications – like payslips and bank statements – and deal directly with the lender on your behalf. We even do all of the follow ups and negotiations for you to ensure you are getting the best deal at the fastest rate.
Once your lender is satisfied you meet all of their requirements, they will issue you a pre-approval. Pre-approvals are usually valid for up to 90 days, giving you time to go house hunting and find the perfect home for you.
If you don’t find the one within that 90 days, don’t stress. We’ll chat with the lender, confirm any changes and get your pre-approval extended.
Just remember
It is always recommended that you have a pre-approval in place before making any offers on properties, and especially before attending an auction. Otherwise, without being sure you have the borrowing capacity to buy a property, you could find yourself in a disappointing and possibly very costly position.
Found your dream home? Then it’s time to move to the next stage, which we will go through next week.
Want to get ready for pre-approval? Call 1300 815 921 or click here to arrange a no-obligation meeting—we’re here to help you take the next step towards owning your home.
