Every journey starts with a single step – let that be your pre-approval

Buying a home is probably one of the most important decisions you will make as an adult. As you question the where (do you see yourself living for the next eight to ten years), the what (features are important to you and your family) and the how (on earth are you going to afford to become a homeowner), it can sometimes all feel a bit daunting.

You should see the process of buying your forever home as a journey, and as with all journeys, where you start can make or break the experience. The starting point for this journey is answering the important “What home can I really afford?” and this sits squarely in the space of the things you can control in this sometimes unpredictable process.

What is a bond pre-approval?

Whether you’re about to start the house-hunting process or if you’ve already found your dream home, calculating your affordability is an essential step on this homeownership journey. A pre-approval from GetGo Home Loans takes your current financial situation into account in order to calculate how much additional debt you can realistically take on in order to finance a new home.

A home loan pre-approval looks at your net income (i.e. what gets paid into your bank account on a regular basis) and total expenses and calculates what size home loan a bank may be willing to offer you. The calculation takes the following into account:

  • Existing debt repayments (which you’re contractually obligated to pay),
  • Non-discretionary expenses (i.e. essential living costs),
  • Other discretionary spend (for example, overseas travel or getting your nails done).

It then looks at how much of your remaining income you can responsibly afford to spend on more credit. Your credit score is also an important check in this calculation as it indicates how well you have paid off your existing debt in the past, and if you’re a low-risk customer to a bank (you’ll see the benefit of this with a more favourable interest rate offered).

A home loan pre-approval costs you nothing, doesn’t impact your credit score, and is a quick process. The outcome thereof should make your home-buying journey feel less daunting.
Start your pre-approval now.

What is a pre-approval not?

Completing the pre-approval process is not the same as applying for a home loan and doesn’t mean you’re guaranteed to receive a home loan offer from any bank at the point at which you apply. There are still several checks and comprehensive assessments that banks will do when they receive your application.

So why should you do a pre-approval then?

When you’ve completed the pre-approval process with GetGo Home Loans, you can be sure of the following:

  • You will have a realistic idea of what properties you can afford, and you can house hunt with confidence. This means you might need to look at more affordable neighbourhoods or compromise on some of the features you’ve set your heart on. The responsible thing to do is set your maximum affordability amount to a more realistic value as you search for homes.

  • Providing this pre-approval to estate agents and sellers shows them that you’re a serious buyer and it should speed up the overall buying process because of the certainty that it creates.

  • If you do make an offer on a property, a bond pre-approval sets your offer apart from others, and may help you to negotiate a better deal.

  • No unpleasant surprises when you submit your application for finance to the banks (remember that they’re going to calculate your affordability in a similar way, albeit a lot more thoroughly).

It’s about the journey AND the destination

Remember, the destination of this journey is your dream home. So doing the prep work upfront and controlling as much as you can of this process is critical. The key to the home loan pre-approval process is being as honest as you can be about your current financial situation to ensure that you don’t find yourself in a financial predicament in the future if things change. If over 90% of GetGo Home Loans’ clients who are pre-approved get a bond, why wouldn’t you do one today? Start your pre-approval now.