It doesn’t matter whether you are a first home buyer or an existing mortgagor, you can always get a pre-approval before making any decisions.
The purpose of pre-approval is by disclosing your overall financial situation to the bank to determine exactly how much you can borrow and what criterias you need to meet to get your loan approved. Before you actually find a house, pre-approval will always save your valuable time and determine the range of the value of the house you should look for.
The basic procedure includes but not limited to:
- Find a bank that you prefer
The typical reasons could be: you are already banking with them, don’t want to change; they offer better interest rate compare to its competitors; better service and long-term reputation that you can trust
- Preparing documents
Those documents show your full financial situation in order for the bank to make judgements
- Lodging the case
This is when your broker send all the supporting documents to designated bank for their approval. Under most circumstance they will come back and ask for more information, but there is nothing for you to worry about, we will take care of all the paperworks and follow-up.
- Conditional approval
If everything goes smoothly,you can expect to receive a conditional approval shortly after the lodgement.
By then, you are able to know how much you can afford to buy precisely, as long as your financial situation will not have significant change afterwards.
The next move is when you find the right property. With the contract of sale and other supporting documents, the loan will then proceed to formal approval.