So how do you actually go about getting a loan?
Banks and lenders require a lot of information about you and your financial commitments and these days due to the CCCFA you need to provide a lot more evidence.
If you need money for buying a house, a car, or bundling your debts into a single loan, there are things you can do to prepare yourself and give yourself a greater chance of success for getting a loan. The “funny” thing is that high risk credit services such as Buy Now Pay Later systems (like After Pay, Zip and Lay Buy) require very little information to get access to credit. For every other sort of loan, you are best to take the time to prepare before you need to get the funds.
The things to do are:
1. Make sure you have a valid Photo Id – many people have an expired Driver Licence and don’t realise it! ????
2. Check your credit report – address any issues with defaults and close unwanted facilities – seek help from us if you need
3. Check your account conduct- make sure you are operating your accounts within their limits and paying your bills on time, going over the account limit is one reason that banks will decline a loan. Read our blog about Missed Payments for a bit more insight.
4. Spend less than you earn and have surplus income to service debt
5. Restrict any unnecessary spending for at least 90 days prior to applying for a loan so that you have evidence that you can afford to service the loan
6. Pay off and close any “buy now pay later” loans and credit facilities such as Gem cards
7. Prepare the evidence for the banks
- Loan documents with interest rates and loan term
- Bank statements – we have a cool way to collect these, talk to us!
- Pay Slips or financial statements if you are self employed
- Tenancy Agreements
- Property information including EQC docs, SOW and insurance policy
Check in with your mortgage adviser to ensure that you are going to meet the servicing criteria and that you are working with the right bank. When the banks are busy they may not take on new customers or provide finance pre-approvals to new to bank customers.
Working with a Mortgage Adviser will allow you to prepare for a successful application when you are ready to borrow. 3 months is a long time to wait if you need the money now and you have not done the required preparation, so talk to us now.