What comes first: the property or the loan?


Looking for a property is an exciting time, and it’s easy to get carried away with looking at houses. However, the longer you delay securing the finance, the weaker your negotiating position on a home becomes.

Get your pre-approval

Organising the finance for a property isn’t as exciting as deciding on a location or size of a house, but it is important to get the essentials sorted first. Gaining pre-approval will give you more confidence in how much you can afford to borrow, which will give you an idea of your target price range.

Before you can be approved for a home loan, the lender will assess your ability to repay the debt. You don’t want to be in a situation where your credit history is an issue, or your deposit is not up to scratch, and you’ve already made an offer on a home.

Making an offer

When it comes to putting down an offer on a property, you will be in a good position if you have already organised finance. You want to come across as a qualified purchaser to the vendor and real estate agent, especially if you’re putting an offer on your dream home. Also, be sure to let the agent know that you have conditional approval (pre-approval). Having conditional approval demonstrates that you mean business.

Sellers are most interested in completing their sale fuss-free and with stable funding, and showing that you are capable of both will help put you at the top of a potentially competitive list of applicants.

In the instance that you find and secure the purchase of a home without having your loan pre-approved by a lender, there are a few pitfalls that you risk running into. Without having the finance sorted, you may risk losing your 10 percent deposit which you hand over to secure the property. Additionally, you may be liable for damages which could run into the tens of thousands.

Be organised

Organising a home loan isn’t a process that should be rushed, and preparation is critical for what could be the biggest financial decision of your life. Therefore, if you are you currently searching for a property or looking for one soon, get in contact with us so we can discuss your options have your finance ready for your purchase.