To be able to act quickly and take advantage of the well priced properties that become available it will be to your advantage to have a pre approval for finance in place.
Pre approval means that you can receive 'conditional' finance approval to buy a property which you haven't yet chosen. Usually the 'conditions' will be that approval is subject to the property being 'suitable security' for the funder. Pre approval is valid for 90 days and can often be extended for another couple of months.
To be approved the information that needs to be provided is as follows:
- Application form needs to be filled out
- Proof of Identity (Photo ID required)
- Proof of deposit - showing in a bank account
- 3 months personal transactional bank statements
- 6 months loan history for any existing mortgages in Australia - All lenders want to know that a new borrower is making their existing payments on time)
- Tenancy agreements of any existing investment property already owned.
- Proof of income - either the last 3 consecutive payslips or a letter from your employer. If you are self employed then the funders need the last 2 years full financial accounts.
Once you have chosen the property, you will want to obtain un-conditional approval from the funder.
Un-conditional Approval Requirements
After your purchase your broker/lender will need the following information which will generally be faxed by your real estate agent or property finder to your broker/lender:
- Sale & Purchase agreement signed by all parties
- Rental appraisal from a local Real Estate Agent
- Registered valuation (RV) for the property (let your broker/lender know who the valuer is so that the RV can be addressed to the appropriate funder).
Funds are available since the banks are also a business and need to keep lending. However, they are much more conservative and really double check everything.
If you have any questions or just need some clarification then please email Tina at email@example.com
Tina Webb is an investor working with investors to increase their property portfolio. Tina Webb is also a professional mortgage advisor and runs her own company called Homelink Enterprises (NZ) Ltd