Do You Need Pre-Approval for a Home Loan?

Do You Need Pre-Approval for a Home Loan?

It’s hard to know sometimes what is the best option when looking at home loans as there are all sorts of options and a whole heap of language used you’ve never heard of.

Pre-approval for a home loan can be a point of difference when it’s time to actually purchase your dream home.

So we have given written a rundown of what pre-approval is and how it can benefit you

What is Pre-approval

After years of saving for a deposit on a home, you’re finally ready to become a homeowner. Imagine finding your dream home and then realising you’re not able to get finance or it is well out of your budget. Getting pre-approval on your home loan is one way to avoid this, it will allow you to get confirmation from a lender on how much they are willing to lend you to purchase your home.

They will take into account the amount of money for a deposit you have saved, living expenses, your income and current financial situation. The pre-approval loan from your lender is the maximum amount they are willing to lend you, this helps to give you a price bracket when you do start looking for a home.

Benefits of Pre-approval

If the house you’re intending on purchasing is going to auction, it’s very important to have your pre-approval done before attending the auction. This will help give you a guideline of how high you can go in the auction and not get carried away. Some real estate agents will also take you more seriously as they know you’re a serious buyer and not wasting time.

The best part about the pre-approval is that it will be valid for 3 months which gives you a great window to search for that perfect home.

How to get pre-approval

Unsure where to start in the pre-approval process? Talking to a Capita broker can help with this as we have access to over 30 different lenders and can do the hard work for you.

Talk to a Capita broker near you today.

Financial Advice Disclaimer: This information is general in nature. Mortgage brokers do not provide financial advice. Clients seeking financial advice will be referred to a qualified financial planner.