MORTGAGE PRE APPROVALS

What is a Mortgage Pre/approval?

It’s when a bank assesses your financial position and decides whether they want to lend you money or not. A few of the things they look at are how much you get paid and whether you’ve saved or borrowed money in the past. In short, it pretty much tells a seller you’re serious and ready to buy a property.

What would the banks need from me?

You’ll need to organise documents like:

-           Pay slips and tax returns

-           Bank statements

-           Information on any debt you have

-           Proof of anything you own that might be worth something

Banks will then do something called a credit check. This means they will look into your financial history to see how good or bad you have been with your money in the past (this is where a mortgage broker can also help).

Based on this, they will decide how much they want to lend you and you get a “Pre-approval letter” that you can show to potential sellers. On the letter they also let you know things like how much interest you are paying and if there are any terms on the loan.

Are there any fine prints or things I should avoid?

There are always things you should be aware of before you borrow.

-           If you don’t need the full amount the bank offers, don’t just borrow it because you can. There can be costs like taxes, insurance and maintenance you need to factor in as well.

-           Don’t do anything drastic like change you job, buy expensive things or get into any other debt! The banks don’t look kindly to that if they’re going to lend you money.

-           Don’t just go to the bank you’re most comfortable with – shop around for the best deal. A mortgage broker has connections with many banks to help you with this!

How long does a Pre-approval last?

A pre-approval expires after around 60-90 days. You can apply again if you need.

Will I get a Pre-approval if I had a crappy financial history?

It depends on the bank, but usually yes. As mentioned above, Mortgage Brokers have great connections with banks, and can suggest which will still lend with a “not so good” history.

I’m interested! What can I do to make this happen?

Get yourself a Home Loan Wingman aka mortgage broker! A mortgage broker can help you through this process. They can guide you, they compare banks and make sure they have the right one for you. They also handle all of the paperwork for you and chat with the banks on your behalf which obviously would save you time and stress. They can also make recommendations on what you can do to help you get the outcome you want!

Interested in getting yourself your very own Home Loan Wing Man? Call Dion 0402 814 022