05 Apr 2018

How to Protect Yourself When Buying a House

pre approval

The process of purchasing property, whether it’s your first home or second, is never totally stress-free. But there is one crucial step you can take to safeguard yourself and eliminate a lot of that stress.

The best piece of advice you will ever receive and should always follow is to use conditional and pre-approvals from a lender to best aid your home loan application and property purchase. 

Conditional approval

A conditional approval means a lender has assessed your financial situation and the estimated loan amount they propose for you could be formally approved once you find a property. You can use conditional approval to gain clarity on what financial backing you can expect to achieve and let agents, sellers and auctioneers that you are a serious buyer.

Knowing in advance how much you can borrow helps you twofold. You can save a lot of time, narrowing down your house search to areas and properties within your budget. You can also work out how much your loan repayments will be weekly, fortnightly or monthly to ensure that you’re not stretching your budget and compromising on having a comfortable lifestyle.

Getting a conditional approval before house-hunting will give you the advantage of speed to act when the right property comes along, giving you the upper hand over other buyers.


Pre-approval is the confirmation from Mortgage House that, now that the property you wish to purchase has been valued and we have all required information from you, provided final checks are completed successfully, you can proceed with our financial backing. You can use pre-approval to that you’ve had valuated and approved by your lender. 


Going ahead and committing to buy a property without a pre-approval could be risky, because what if the lender rejects your loan amount request? Putting a conditional offer down on a property with the security of pre-approval means that as long as your final checks are completed successfully, then the sale will go through smoothly. 

With most homes in NSW going under the hammer at auctions, you would need to put down a deposit straight away if you win, and there is no cooling off period. If you do that and then can’t complete the purchase, you would lose your deposit. You may also be held accountable for losses suffered by the seller, leaving you more out of pocket.

You can apply online for a loan pre-approval or conditional approval by filling in all your details, including your assets and liabilities. This is an initial assessment only and to fast track your application it’s best to submit the relevant documents required to get an unconditional approval.

The good news is that most of the supporting documentation required for the pre-approval application is the same for the full application. Because you’ve done all the paperwork up front, it saves you time.

Both conditional approvals and pre-approvals are valid for 90 days from issue. For pre-approvals, the lender will also need to accept the property you’re buying. To reduce the risk of them rejecting the property, email your lending specialist the link to the property listing in advance.

The main delay for getting a loan approved is not having all the required documents ready for your application. Providing everything immediately can get you a faster approval.

Mortgage House

At Mortgage House, we’re no strangers to the homeowner’s journey. It’s a long (but rewarding) one.

But don’t worry, we can help with that.

If you’re thinking of buying a home, you can apply online for a pre-approval or contact us for information about the best options for you when it comes to your mortgage.

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