6 ways to ensure a speedy home loan approval
If you’re new to the housing market, it’s essential to know that the home loan process can be a lengthy one. So, you want to ensure you’ve done everything you can to speed up the process. Have you been ‘umming and ahhing’ about how long it’ll take for a home loan approval? We’ve put together 6 ways for you to speed up the process.
Pre-approval is also known as indicative approval or conditional approval. It’s not a final approval of your home loan; it’s simply an indication of the maximum amount of money you can borrow from a lender. It will also help you to look at houses within your budget, give you a better understanding of the kinds of areas you can afford, and what your monthly repayments are likely to be. It’s important to go through this process early as it will save you time in the home loan application process down the road.
Always opt for a formal, written pre-approval document with the set time-period that your pre-approval stands for. It will ensure you can negotiate with brokers or lenders effectively. To obtain pre-approval, you’ll need to include documentation that will be taken into consideration for both your pre-approval and home loan application. This leads us to the next point.
2. Collect appropriate documentation
Below is a list of documents that you’ll need to use to apply for both pre-approval and your home loan:
- Multiple points of ID (driver’s license, passport, Medicare card)
- Payslips from the last 3-6 months and group certificate, or notice of assessment if you’re self-employed
- Bank statements for evidence of historical savings or other financial documents proving this
- Any statements of current debts such as credit cards, outstanding loans, phone bills, rent etc.
- Any tax returns up to 18 months old.
Having all of these documents ready when applying for pre-approval or your home loan will ensure a speedier process. We recommend keeping a separate copy of all documentation in a safe place, in case you need access to them again.
3. Organise a property valuation
Once you’ve decided on the house you want to buy, you’ll need to organise a property valuer. Choose a service provider who is independent from your lender to inspect the property and make an accurate valuation. The timeline on this process can vary, but if you do the right preparation, you can speed it up. If you have access to building plans, send the plans over to the valuer in advance to assist in taking measurements.
4. Peak periods to avoid
When applying for a home loan, there are peak periods you should avoid if you want the fastest process possible. The lead up to Christmas and the holiday period are always a busy time for lenders and brokers. During this time, lenders have multiple loan applications to process and submit at the same time. Other periods where lenders face higher demand include: directly after a low rate announcement, a change in rates from the Reserve Bank of Australia and as the housing market dips.
5. Know your credit history
In line with preparing all of the appropriate documentation, you should also apply for a credit history check. This helps you avoid any unwanted surprises when you eventually apply for a home loan. Your credit history will make you aware of any outstanding loans, debts or credit marks against your record. This can be done online.
6. Pay particular attention to detail
We know it can be an exciting time when applying for a home loan and purchasing the home of your dreams. However, it’s helpful to take care when collecting and filling in all documents; ensuring there are no mistakes that could set back your application. If information isn’t 100% correct, loans can be knocked back and the application may need to be re-submitted. Plan ahead and make sure you’ve collected all the required documents, making sure that they can be submitted correctly. The documents should also be legible and up to date.
At Mortgage House, we’re no strangers to the home loan application process. If you’re thinking of applying for a home loan, you can Apply Online today to get started! If you have any questions, you can call our lending experts on 133 144.