Home loan pre-approval: how it works and how long it lasts
Last checked
As at Next checkPre-approval shows how much a lender may lend you before you find a home.
- It lasts 3 to 6 months, says Moneysmart
- It is not final approval
- The lender still assesses you and the property
- It does not commit you to the loan
What pre-approval is, and what it is not
Pre-approval is a lender's early view of how much you may be able to borrow. The lender asks for evidence of your financial situation to assess whether you can repay.[1]
It helps you set an affordable price range. It also shows sellers you are serious about buying.[1]
It is not final approval. The lender still assesses your circumstances and the property before it gives final approval.[1] Pre-approval does not commit you to the loan either.[1]
How long does pre-approval last?
Moneysmart says pre-approval lasts 3 to 6 months.[1] Each lender sets its own period, so check the date on yours. If it runs out before you buy, ask the lender how to renew it. Your finances may be checked again.
What lenders ask for
Expect the lender to ask for evidence of your financial situation.[1] Each lender sets its own list. Zafar tells you which documents the lender needs for your situation.
Please do not email payslips, bank statements or identity documents before your first conversation. Zafar will explain how to provide them securely.
Start your pre-approval with Zafar.
Request a call Call 0402 357 860
Or ask Zafar to call you back
Credit enquiries and your credit file
Moneysmart says each application for credit is noted on your credit report. Too many applications in a short time can lower your credit score.[2]
Lenders use your credit score to decide whether to lend to you. Depending on the credit reporting agency, it runs from zero to either 1,000 or 1,200.[3]
So ask a lender whether its pre-approval involves a credit check before you apply. Applying to many lenders at once can count against you.
You can get your credit report from a credit reporting body every three months at no cost.[2] It is worth checking it for errors before you apply.
New job, probation, contract or casual work
Lenders treat these differently. Some may consider an applicant still on probation; others want a longer work history. Each lender sets its own policy on contract and casual income.
Zafar can check which lenders on his panel may consider your work situation before you apply. That can save an application that is likely to be declined.
After pre-approval
Once you find a home, the lender values the property and checks your details again. Then it decides on final approval. Work out your deposit and upfront costs early, so they fit your price range.
Worth weighing up
- Pre-approval is not a promise of a loan. Final approval can still be declined.
- Your finances can change between pre-approval and settlement. Tell your broker or lender if they do.
- The amount a lender may lend is not the same as what you can comfortably repay.
- Zafar compares loans from his lender panel, not the whole market.
General information only. It does not take into account your objectives, financial situation or needs, and it is not a recommendation to enter into any credit contract. Approval is the lender's decision, made on its own criteria.
What changed
- : Page created. Every statement checked against the Moneysmart pages listed below.
Ready to get pre-approval?
Zafar can work out which lenders on his panel suit your situation and look after the application.
Start your pre-approval with Zafar Call 0402 357 860
Read more home loan guides.
Sources
- Moneysmart (ASIC), Buying a house. Retrieved .
- Moneysmart (ASIC), Loan rejection. Retrieved .
- Moneysmart (ASIC), Credit scores and credit reports. Retrieved .
Common questions
How long does home loan pre-approval last in Australia?
Moneysmart says pre-approval lasts 3 to 6 months. Each lender sets its own period, so check the expiry date on yours.
Does pre-approval affect my credit score?
It can. Each application for credit is noted on your credit report, and too many in a short time can lower your score. Ask whether the lender runs a credit check.
What credit score do I need for a home loan?
There is no single score we can quote: each lender decides on its own criteria, and your credit score is one thing it looks at. Scores run from zero to either 1,000 or 1,200, depending on the credit reporting agency. You can get your credit report every 3 months at no cost, so check it for errors before you apply.
Can I get pre-approval while on probation in a new job?
It depends on the lender. Some may consider applicants on probation and others want a longer work history. Zafar can check lenders on his panel first.
Is pre-approval the same as final approval?
No. The lender still assesses your circumstances and the property before giving final approval. Pre-approval does not commit you to the loan.
Talk to Zafar
Call Zafar, request a call back or send a message. Zafar works with clients across Australia by phone and video, and meets clients in person in Melbourne.