While it's not a must, getting pre-approval for your first home loan can make the buying process a lot easier for you. It can help you shop around with a clearer idea of your price range, negotiate with confidence and speed up the home loan application process.
Benefits of a home loan pre-approval
Home loan pre-approval means you are clear from the get-go about what price range you can afford when you are shopping for a home. While you can also use a mortgage calculator to figure out your approximate borrowing power, different lenders have different requirements and getting pre-approval means you have a more accurate price range that takes this into account. Mortgage brokers are a good source of knowledge when it comes to these individual requirements, and can help you sort out your pre-approval before you begin looking for a home.
You can also use your pre-approval as extra leverage when you are negotiating with vendors, as you are less likely to have to pull out of any contract at the last minute because you can’t get a loan, which will make you a more attractive buyer. You will also have a clear ceiling price to work with in negotiations and are less likely to be pushed into paying over your budget.
Faster loan process
Getting pre-approved means you’re more likely to have a faster final approval process too, so you won’t be waiting around to hear from the bank before you can settle your contract and move into your new home. Pre-approval is free to obtain and it lasts from between three and six months depending on the lender, so you have plenty of time after you've received your home loan approval to find a home that you are happy with.
If you’re thinking of looking for a new home, it’s certainly worth your time to visit a mortgage broker and obtain home loan pre-approval before you start to shop around. Choice Home Loans mortgage brokers are experienced at handling the pre-approval process, have a wide selection of lenders to choose from and can guide you through everything you’ll need to apply. Talk to one of our friendly and knowledgeable brokers today.
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