Getting Pre‑Approved: A Roadmap to Home Loan Confidence

Pre‑approval (also called conditional approval) gives you an idea of how much you can borrow before you start house‑hunting. Here’s how it works and why brokers add value:

Steps to pre‑approval

1. Financial assessment:  Provide your broker with payslips, tax returns, bank statements and details of existing debts. They’ll calculate your borrowing capacity and advise you on deposit requirements.

2. Loan recommendation:  Your broker compares lenders’ credit policies and recommends one or more suitable loans.

3. Lender submission:  The broker submits your application for conditional approval. This includes verifying your identity and running a credit check.

4. Conditional approval:  The lender issues a letter stating the maximum amount you can borrow, subject to valuation and final approval.

   
   

Why pre‑approval matters

• Budget clarity:  You know your price range, which helps narrow your property search.

• Stronger negotiating position:  Sellers often favour buyers with pre‑approval because it signals you’re serious and your finance is likely to be approved.

• Faster settlement:  Having your finances partially assessed means fewer delays once you find a property.

  
  

Broker’s role

Your broker ensures your application meets lender policy, which reduces the risk of surprises later. They can also negotiate extensions to your pre‑approval if you need more time. Remember that pre‑approval isn’t a guarantee; avoid making major financial changes (like taking out new credit cards) until your loan is formally approved.