Pre-approval is an important step for home buyers.
Here we explain the process for getting conditional approval for your mortgage.
Getting conditional approval for your home loan
allows you to look – and enquire – with confidence, and it helps
narrow
your options.
Here are eight commonly asked questions about conditional
approval, that important first step in the home buying journey.
1. Do I need conditional approval?
Most
people at an open house aren’t looking to buy that particular house. They’re
doing their homework, getting a sense of the market. They’re dipping a toe in
(or just being nosey!). But with loan conditional approval, you’re in a
different camp. You’re the real deal. You’re showing real estate agents and
vendors you’re serious and someone to negotiate with.
Conditional
approval also keeps your feet on the ground. You know exactly how much you can
afford—and don’t waste time drooling over houses outside your budget.
2. Pre-approval, conditional approval
or approval-in-principle?
Different
lenders use different terms—pre-approval, approval-in-principle and conditional
approval—to describe much the same thing. It can be confusing. But think of it
like this:
- It’s an enquiry
to establish your financial position.
- It’s an
indication (not a guarantee) from the bank as to how much you can borrow.
3. When should you apply for
conditional approval?
Homebuyers
often apply for conditional approval once they’ve done some initial research:
- Worked out borrowing capacity using various financial
tools and calculators
- Worked out how
much you can afford to repay
- Studied different types of home loans, and you may
have looked at the local property market and suburb you’re interested in.
Don’t
apply too early—our finance partner’s conditional approval is valid for 90 days
from application, but you can apply again.
4. How do you apply?
Contact us @ propertyloans@realrenta.com and we will arrange
for a lending specialist from our trusted finance partner to contact you.
5. What does the conditional approval
process typically involve?
Your
lender will look at how much you owe (loans, credit cards etc.), and how much
you own (assets including cars, shares etc.). Typically, your lender will
perform a credit check on you with an external credit bureau.
At
this stage, your lender will most likely want some information about the
property you are wishing to obtain a loan for ( postcode, type of dwelling
etc.).
They’ll
also want to know how much you earn (your wages/salary), and what your expenses
typically are (food, utility bills, rent etc.).
Marlene Liontis
Thursday, 7 November 2019
