With the property market as hot as ever and purchasers falling over themselves to inspect, offer and commit, it's important to have pre-approval in place so you can keep up with the market pace and exchange contracts to secure the property as quickly as possible.
We often hear the words ‘I have pre-approval' and this often follows with ‘my pre-approval is for a larger amount than the purchase price, so there should be no issue.'
In most cases the pre-approval stamp held has not gone through the normal stages of employment and income verification (tax returns or BAS statements), evidence of savings history and asset/liability verification. Pre-approval can often be your banker/broker taking a glance at your income and affordability and saying yes you can service a loan up to $900,000. Before entering into a contract to purchase a property you need to hold formal loan approval. Often a lender will not consider a loan application until a property has been found so a valuation report can be obtained. To be fully prepared, it is suggested that all employment information, evidence as to savings or gift (of the deposit), asset and liability financials be in order and provided to your broker/bank so that once a property has been found, the only condition of pre-approval is a satisfactory valuation.
If you want to compete in these market conditions you need to be organised and place yourself in a position ahead of the competition.
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