The lending landscape has changed dramatically in the last year, these 6 tips will help if you are looking to borrow money for your home loan.
- Prepare Early
- Household budget
- Preapproval
- Reduce credit card and consumer credit
- Credit History
- Engage a mortgage adviser
1. Prepare Early
Firstly, get your ducks in a row and prepare early. Sorting your finances out in in advance will take some of the stress out of the buying process. Expect a month to complete the transaction, approval and through to settlement can sometimes take a month with valuers taking longer to assess properties and bank approvals being pushed out, given the greater scrutiny on loans.
2. Household Expenses/Budget
Understanding your household budget going into your loan process is vital. Lenders will want to understand your expenses at a granular level including core and variable expenses.
3. Pre-approval
Obtain a pre-approval so as to give you a clear understanding of your purchasing power before going into negotiations.
4. Reduce Credit Card Debt
Tidy up any unnecessary debt before applying. Even if your credit card balance is zero, your full card limit is used for assessment of the loan. So reduce / eliminate any unwanted or unused credit card debt or limit.
5. Credit History
Check your credit history, you can obtain a free record that does not affect your history and ensure your credit report is in order. Moneysmart have provided a good understanding of the credit scoring process and some good resources to check yours.
6. Engage a mortgage professional
Unfortunately loyalty does not mean a better price. The Royal Commission outcomes have shown that 80% of Australians are paying on average 0.40% more than they should be for their mortgage. Talk to your mortgage professional about the transaction, they can help you with:
- Choice of lender,
- Price discovery and the best rate for your loan,
- Loan options including offset and redraw facilities.
- Experience with the current lending environment.
1 out of every 2 loans in Australia is now handled by a broker. Given the continually changing landscape of borrowing post the royal commission let us help you with your home loan.
Book a 15 minute phone appointment with one of our lending specialists and we can help to quickly provide:
- A guide to your purchasing power
- Help you with your pre-approval
>>Book Your Strategy Call
1. You will come away from the call with actionable steps to progress your home loan.
2. Understand the current borrowing rates of lending are for your situation.
3. How much you can borrow.
4. Free valuation report for your target property.
To your success,
Graeam
This Article is for informative purposes only and should be considered general in nature. The article does not take into consideration any personal objectives or circumstances nor constitute an offer of finance.
