What Banks don’t Tell You About Home Loan Pre-Approvals
Pre-approvals are an essential part of buying a property, here’s what you need to know about how pre-approvals really work — and what banks don’t always tell you.
There are two different types of pre-approvals, system generated and fully assessed.
System generated are instant which are based on the information you have provided and without verifying your documents.
Fully assessed involves a full assessment where the bank reviews your pay slips, bank statements, and credit history. These are more thorough and offer greater confidence when making offers.
Complete Home Loans prefers fully assessed which ensures a smoother loan process.
A pre-approval is not an offer of credit, banks can still decline your loan due to the following reasons.
The property doesn’t meet lending criteria or has a valuation shortfall
Your financial situation changes
The bank’s lending policy changes
Most pre-approvals expire after 90 days, after which they need to be updated or extended. If you’re house hunting over a longer period — or delaying your purchase — your pre-approval could lapse. That means updated documents and information may have to be provided. A small tip would be to set a reminder to review your pre-approval before it expires.
When you work with a mortgage broker like me, you benefit from pre-approvals through the right lenders, a thorough document review to ensure accuracy, expert guidance in selecting lenders that match your property goals, and ongoing support if your circumstances or strategy change during your property search.
