Many home buyers usually assume that they have a formal home loan approval when, in fact, they haven’t been granted any. The risk that presents itself here is that you can make an unconditional offer in order to buy a property and then later discover that you haven’t been approved a home loan.
This is why you should always remember that your loan can’t be formally approved until the lender you worked with formally examines your deposit, Contract of Sale (if applicable) your written evidence of outgoings and income, as well as your personal ID.
You should do your best to know and understand the difference between conditional and unconditional home loan approval to avoid any confusion.
This type of home loan approval means that, in theory, your loan has been assessed and then approved by your lender. However, the lender will still need more information from you before they can grant you with unconditional – also referred to as ‘formal approval’.
The lender may require information such as a valuation of the property that you are about to buy, more recent payslips, or a dated and fully signed sale contract.
On the other hand, keep in mind that the bank may also come with requirements that you have to meet before they formally approve your home loan.
In short, a conditional home loan approval means that your loan has been approved but there are still some conditions that you have to meet before celebrating.
By definition, unconditional approval means that there are no conditions that you have to meet for your loan to be approved. Obviously, unconditional home loan approval is what you should be looking for to make sure that you are very, very close to purchasing and owning a new home.
Your lender will send you a confirmation letter saying that your loan is now formally approved. This means that they have formally assessed your paperwork and have signed your loan application.
In short, they have decided to proceed with your home loan and are happy with their assessment.
You must not forget about timeframes. Conditional and unconditional approvals don’t last forever. They usually come with a timeframe of three up to six months. However, even then, nothing is certain until the settlement itself.
Your lender may still cancel the deal if your financial situation has changed in such a way that you are no longer able to afford a home loan.
Now you shouldn’t have any more questions about conditional or unconditional home loan approvals! It’s simple – the first means that you still have some things left to do, while the latter means that you are on the brink of purchasing a new home.
However, if you still have any questions – related to approvals or home loans in general – you can always get in touch with us. We will provide you with the information you need and, if you need any more help, we can also guide you through the process of finding a favourable lender for your needs.
Don’t hesitate – reach out and contact us today! 02 8530 1107 or Submit your scenario online
We meet for a consultation, obtain your supporting documents and proceed to structure and package your application for approval knowing exactly what the banks want to see. We also monitor your home loan post approval ensuring you’re home loan suits you and your financial position
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With our many years experience in the industry, we’ve been exposed to both easy and complex loan scenarios. Each loan we process gets presented to over sixty financial institutions, ensuring we have explored all options possible and are able to provide a solution
Whether you’re a first home buyer looking at entering the market or an existing home owner looking at ways to save money on your home loan, we have you covered. We’ve put hundreds of hours of research into these guides to ensure you end up ahead, and it’s completely on the house.
Buying a home or a property may imply a deposit. You may come across home loans that require no deposit at all, but their approval criteria are known to be tough.
Therefore, you are left with only one thing to do – namely, to save a deposit so that you will be able to purchase a home or a property.
When you’re applying for a home loan, your lender might want to know how you plan to exit it. After all, it is a lender’s job to make you understand that you do have to plan your loan repayments and so on.
In this respect, you will need to come up with a proper mortgage exit strategy. You have to make sure that the financial path that you choose will be able to make you exit your mortgage on time and avoid missing any payments.
The odds are that you’ve stumbled across the term lender’s mortgage insurance and you’re wondering what it stands for. Well, you’ve come to the right place. This article will clarify this term, so that you can understand what it is, the concept behind it and the approximate costs. Let’s get started!
The odds are that you’ve stumbled across the term lender’s mortgage insurance and you’re wondering what it stands for. Well, you’ve come to the right place. This article will clarify this term, so that you can understand what it is, the concept behind it and the approximate costs. Let’s get started!
As we all know, saving money for a deposit can be quite difficult, especially when we are in a tough spot. Moreover, if you want to use that deposit in order to get a home loan and fulfill your dream, things are probably going to get more stressful for you in no time.
The odds are that you’ve stumbled across the term lender’s mortgage insurance and you’re wondering what it stands for. Well, you’ve come to the right place. This article will clarify this term, so that you can understand what it is, the concept behind it and the approximate costs. Let’s get started!
What you need to know before you purchase your first property and how to fast track it. We have designed this guide to get you up to date with everything you need to know about being a first home buyer. Whether you have a short term goal of purchasing your first property or are thinking about it sometime later down the track, this guide will cover important essential aspects of this exciting journey.
What the banks won’t tell you and how to save serious money on your home loan. By Investing 10 minutes of your time to read through our guide, not only will you learn the tips and tricks the banks won’t always tell you to assist you with paying off your home loan sooner, but also gain an insight into some techniques that will allow you to minimise the interest you pay to the bank.
The best way to take control of your finances is to use a budget planner. This is a simple tool that helps you understand the money going in and out of your household. With our Highline Lending Budget Planner, we’ve got you covered. This handy tool allows you to log and track your goals, track your savings, track your debt and expenses and keep a monthly record for an end of year evaluation.
