Home Finance Article - Pre-Approved Home Finance - Buying a Brisbane Home with Confidence
This article comes from the home finance team at Money Search BrisbanePurchasing a property, while a huge milestone, can leave even the most seasoned buyer feeling frazzled. Arranging pre-approved finance takes the guesswork out of what you can afford - allowing you to bid with confidence and within your means.
Obtaining pre-approval from your financier makes a lot of sense. It is better to discover that you can't afford that beachfront property you've always wanted before you put down the deposit!
The pre-approval process is essentially the same as arranging full finance. You'll need to complete an application form and provide relevant documentation, such as proof of savings, tax returns and pay slips. A pre-approval can take from a few hours to a few days to process, depending on the lender.
If your application is successful the lender will issue a 'pre-approval letter' with a shelf life of normally three months. This will give you a clear picture of what you can borrow as well as your monthly repayments.
And when you find your new home or investment property, you can bid with confidence - safe in the knowledge that you have your finances sorted out. However, even with a pre-approval, the property still needs to realize a satisfactory valuation, plus favourable building and pest inspection results before your finance will be finalised.
Advantages at a glance
- Bidding power - if buying at auction you will need to pay a deposit and sign the contract on the spot. It is important that you know your limits and that the necessary financing is already substantially in place.
- Bargaining power - if you are armed with pre-approval you will be treated as a serious buyer by real estate agents and sellers which may give you the edge over buyers who are unsure of their financial status.
- Peace of mind - a real understanding of your borrowing capabilities minimises the risk of borrowing beyond your means.
Source: Mortgage News - Solution Finance
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