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Get ahead of the competition with a pre-approval
Are you searching for your first home? Or perhaps looking to increase your investment portfolio with another property? Before you can get yourself your very own property, you need to go through the process of securing a home loan. This is where a pre-approval comes in handy.
Step 1 – Speak to a broker
The first thing you’ll need to do is talk to a mortgage broker. They’ll ask you a number of questions – your employment history, your income, your long-term goals, for example. After this soul-baring session, they’ll use the information to work out your borrowing power, and find the right loan product for you. They’ll also explain all the various fees, charges and costs that are involved, to make sure you’re on the right track.
Step 2 – Sorting your application
Now that you’ve picked your home loan, it’s time to apply. Your broker will be right there to offer you a guiding hand through the process. They’ll let you know what documents you need to provide, and you’ll also go through the age-old ritual of filling out and signing a number of forms. The broker will send off the application to the mortgage lender when it’s done and dusted.
Step 3 – Getting pre-approved
Once the lender gets your application, the ball’s in their court. They’ll spend some time going through the information you’ve provided to make sure all the details check out. They’ll also use a credit reporting agency to check your credit history. Once you pass, then congratulations – you’ve obtained pre-approval for the loan, and you now are ready to find your dream home!
The first benefit of loan pre-approval is the fact that you can start looking at the right homes. There are a number of people who start looking at homes without knowing if they would actually be able to get the accompanying loan. With loan pre-approval, you know you are looking at properties you know you can afford.
Another benefit of loan pre-approval is the fact that you will not be dealing with any last minute surprises. You know exactly what you are getting, which takes a lot of pressure of your shoulders. When you make an offer, you can be sure it is going to close thanks to the pre-approval you have obtained.
Sellers are also more likely to accept offers from buyers with a pre-approved loan, even if your offer is slightly under the offer of another applicant. At the end of the day, sellers will take a secure sale over a possible sale, so pre-approval can benefit you in that way as well.
The last benefit of a loan pre-approval is the fast closing period. Instead of having an average closing time of 30 days, buyers can shorten that time to two or three weeks. Sellers who want to sell quickly and without much hassle are therefore more inclined to choose you.
Loan pre-approval has a lot of benefits for your finances as well as your home searching process. By taking advantage of a mortgage broker, you can arrange your loan pre-approval in no time at all. Read on to discover some of the benefits of loan pre-approval and how a mortgage broker can assist you with this process.
The mortgage broker will first ask you a number of questions, this can relate to your employment, you income and even your goals. Based on this information, they can start looking for the right loan for you.
Once the broker has proposed a suitable home loan for you, the mortgage broker can start guiding you through the entire application process. Your mortgage broker will tell you what kind of forms you will need to present and take care of all the paperwork that needs to be submitted to the lender or financial institution.
As soon as your broker has submitted all your paperwork, the lender will start evaluating your application. It will take some time for the lender to go through all your information, simply because they need to check the validity of everything you have submitted. In addition to that, they will also go over your credit history. Once all your information has checked out, the lender will pre-approve your loan.