Home Loan Application Process
Getting a home loan can be a complicated and stressful process. Even seasoned investors can feel intimidated by the steps involved in the process. It is important to realise that the loan process begins way before you find the right property and does not fully end even when the loan is settled.
We are here to take away the stress with our simplified step by step home loan application process.
Phase One: Getting started
Step 1 – Speak to our experienced Mortgage Broker
To discover your options the first step is to speak with a mortgage broker. There are many benefits of engaging a mortgage broker, including:
- Generally, the services of the Mortgage Broker are free.
- We work with all major banks, alternate and specialist lenders which could be useful for applicants who do not fit the standard policies of major banks.
- You will get easy and fast approval as the broker will deal with all various requirements of each lender.
- Mortgage brokers negotiate the most competitive deals as they are aware of sharp interest rates and cash back rewards available in the market as they deal with the lenders on daily basis.
- We can help you build the perfect home-loan application, find the best suited loan that fits your needs, and tailor the mortgage to your personal lifestyle.
Step 2 – Initial Discussion
In this stage, we will discuss your current financial situation, your future goals and objectives and determine your eligibility for the home loan. Once we understand your financial background, we then agree on the nature and scope of advice that we will provide you during the course of your home loan application process.
Phase Two: Loan Application
Step 3 – Completing the Application and providing supporting documentation
In this stage, we will collect the supporting documentation, or you can complete an online application form at a time convenient to you and upload the supporting documents yourself so that we can move ahead with the Loan application.
These documents will also allow us to understand your financial background, so that we can present it to the lenders accordingly.
Supporting Documentation may include:
Identification
- Passport/Visa/Citizenship Certificate
- Driver’s License
- Marriage Certificate
- Birth Certificate
Sources of Income
- Your two most recent payslips
- Copy of employment contract and/or a letter from your employer.
- Most recent IRB (Inland Revenue Business) Tax Statement
- If self-employed, the last two year’s full tax returns
- WINZ (Work and Income New Zealand) Statements
- Proof of existing rental income
- Proof of proposed rental income
- Most recent statement for all savings accounts
- Copy of share certificates etc.
- Copy of sale contact on existing home or settlement letter from your solicitor if the deposit it to come from the sale of an existing home
- Statutory declaration if any part of the deposit is a gift, stating it is non-repayable
- Rates notice on any existing properties
Existing Loans documents
- Most recent statement for all credit cards, personal loans, leases etc
- Copy of loan statements for 6 months on any existing mortgages
Property documents
- Copy of contract of sale for property being bought
- Home Insurance certificate for all properties owned
- Copy of plans, specifications and fixed price contract for any construction
- Cheque for establishment fees if needed
Step 4 – Preliminary assessment
In this part of the process, we study your application and highlight the strengths of your application, mitigate the risks that could emerge from a lending perspective.
It includes confirmation of your income, employment, and a credit reference check to calculate your borrowing power and recommend the suitable loan options.
Once the loan option is agreed on, we prepare and submit the application to the lender. The time taken from submission to receiving an approval from the bank can vary depending on the complexity of your situation. The approval time could be between 5 to 15 working days.
Step 5 – Conditioned pre-approval
Once you have met the bank’s lending policies and criteria, the lender will approve your application and will forward the pre-approval subject to conditions to be met before drawing down the loan.
For e.g., one of the conditions could be that the property being purchased is acceptable to the lender.
This pre-approval will allow you to actively pursue potential properties available on the market. It gives you the confidence to put out an offer quickly as you know how much you can spend based on the deposit saved and the amount of loan approval.
Once the right property is finalised, you will contact the broker with the details of the property that you are interested in buying and get the lenders acceptance for the property. The pre-approval generally come with a deadline of around 6 months, which could be extended depending on the lender.
Phase Three: Loan approval
Step 6 – Property Valuation
During the process when the broker gets the approval on the acceptance of the property, the lender may stipulate a registered valuation to be provided by an independent valuer at their own cost.
The Lender requires a registered valuation when their internal estimated valuation system deems that the purchase price is over the market price. These valuations are to be arranged through the broker which they order through the Lender’s valuation systems. This stage is important to ensure you obtain the loan.
Step 7 – Unconditional approval
Once the conditions specified in the pre-approval by the lender have been met, the broker will seek an unconditional approval certificate from the Lender. Once the Unconditional Approval has been received, your solicitor will confirm with the vendors solicitor that the purchase of the property is unconditional.
Phase Four: Disbursements
Step 8 – Loan Structure
We will now discuss the loan structure to meet your goals and objectives. The loan structure discussion will include splitting the loan into various fixed interest rate terms with a portion on floating interest rate if required. We will instruct the lender to prepare loan documents and send them to the Solicitor.
Step 9 – Loan offer and settlement
With the entire loan application being done and formally approved, the lender will provide you with a final loan contract.
You may choose to run through the contract with your solicitor/conveyancer before signing it. Soon after your solicitor will contact your lender to arrange a settlement date.
In the final settlement stage, the purchase amount of the property is paid to the vendor and you become the official owner of the property. You can now move into your new home and celebrate.
Step 10 – Two weeks after settlement
Once you have settled in your new property, we will touch base with you to help you understand the ins and out of your new mortgage.
In this discussion we will answer any queries you have regarding the loan features and its repayments. We will also review your settlement letter, to ensure your financial requirements are met.
Final Phase: Annual review
We do an annual follow up to analyse and review your mortgage to ensure you are on track to repay your debt so you can be mortgage free faster. We check market rates and see if the client’s requirements or financial goals have changed.
Easy Application Process
Dealing with lot of banks can sometimes be stressful. There is tons of paperwork to complete and it can sometimes take a toll on your health.
With our simple application process, we will present your paperwork to all the lenders and find the best deal for you.
Our services are completely FREE.
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