So, you’re looking to buy a house and you want to get finance.
You could walk into a bank, have a conversation with one of their mortgage team, and get finance in 2 to 3 days. This may or may not be the best financial solution for your needs.
Working with an Adviser can take longer than going direct to one of the banks, but the benefit is that you will get a solution that works for you and is tailored to your situation. We look at the bigger picture, and as we have relationships with many lenders we can “shop around” for you to ensure that you get the best possible outcome. It’s not just about the low interest rates – yes, we keep saying it because it’s true!
Brokers work with specialist lending units at the bank and in this hot market are dealing with over 30 new applications a day, most of which are live deals. These specialist units at the banks are taking between 6 and 10 (or more!) working days to process applications just due to the share volume of applications. The clock starts ticking when the application is submitted, so getting a pre-approval is a good idea. You’ll need to supply your adviser with all the information they need as soon as possible.
Pre approvals are useful for giving you an idea of the amount the bank is willing to lend you – i.e. what they see that you will be able to service. It can certainly speed up the process of getting full loan approval and will put you in a better negotiating position as having finance confirmed always looks good. The banks still need to approve the security you’re using.
In this hot housing market allowing ten days for finance and insurance is a minimum.
Even with a pre-approval it is very important that you still completed your due diligence and don’t be tempted to skip getting building reports or LIMS, just so that you have a “better offer”. It’s not worth the risk! You could well feel the pain when you go to sell and you find out something that affects the resale of your property.