Pre-Approvals - what, and why?

Imagine going house hunting, finding the house you love – only to miss out on purchasing it – cos someone else gets their finance approved faster.

A pre-approval can fix that.

We at DUX believe a pre-approval of finance is an essential step in purchasing your next home.

What does it mean? Pre approval?

A pre-approval gives you a head start.

If you’ve worked with your mortgage broker (or adviser as we are now known) to have a pre-approval in place, it means the finance for your home purchase is about 80% complete.

The lender will have reviewed your loan application, assessed your financial situation and have confirmed the maximum amount of money they are prepared to lend based on those factors.

It isn’t a guarantee the loan will be unconditionally approved, but it does give you clarity on the amount you can spend.

What are the advantages?

You know how much you can spend on a home.

            This gives you confidence in which houses you can look at, and, potentially negotiating power as you know what level you can offer to.

You know what conditions you must meet. 

For example if you need to close a credit card you can get that sorted.

Faster loan processing

            Once you have found the property you love, it is a short step to have the lender approve the property for security, and complete any other conditions.  You will be able to love more quickly to complete a sale and purchase agreement on the property.

Gives you confidence going to an auction

            Your finance will need to be unconditional before the auction, with the lender having agreed to use the property as security, and any other conditions signed off.

Pre-approvals last for 90 days

It shows you are a serious buyer – so sellers and agents will take you seriously.

How you get a pre-approval in place?

You work with me as your mortgage adviser.

I will help you with the loan application, navigating the banks’ processes on your behalf.

We will collate the information – income, expenses, proof of deposit, any other debt etc and make the application on your behalf.

I will keep you updated along the way.

What happens once we find a house?

Reach out to me - your mortgage adviser –

You can make offers on a property with ape-approval – up to the amount approved.  Make sure you still have a finance clause in the agreement

Before being “unconditional” on your home loan, the banks will need information about the property to check it meets their criteria to be security on the home loan.

We will also need to have proof house insurance is arranged (the DUX team can help with that too), and we will tick off any other conditions

If you are keen to get going for the next home – whether it is a first home, or the next home for you, a pre-approval will position you to be ready to move.