A Step-By-Step Guide To Applying For A Mortgage

Buying your first home is a life event that is both exciting and scary at the same time. It is exciting because you have taken a significant step towards independence and scary because you are also taking on a huge commitment. Unless you are independently wealthy, you will need a mortgage, and this involves being responsible for meeting its payment terms.

Mortgage Application Process is Similar Regardless of the Lender

There are a number of ways a home buyer can apply for a mortgage, but regardless of whether you apply directly to a financial institution such as a bank or building society, or you use a mortgage broker, the application process is practically the same. Much of it is governed by state legislation for the protection of all parties, and although the circumstances of each mortgage application are unique, the steps to be taken are similar.

First Step is the Appointment with the Lender

For us, this is also the start of a process that began when a client asked our sales staff at Prudential Real Estate to find a suitable property. We don’t get too involved with the mortgage application process, but it usually begins with an appointment with the lender who has offered you a home loan. This can be done in person, over the phone or online, depending on the institution. It is important at this point to have all the documentation they need on hand to avoid delays.

Conditional Approval – Building and Pest Inspection – Property Valuation

The completed documentation is assessed for your ability to service the loan and you may be asked at this point to provide further information. If the lender is happy with your application, they will advise that your loan has been conditionally approved. You should now organise a building and pest inspection, while the lender is arranging a property valuation.

Loan Documents and Offer from Lender

The lender then should contact you, and at this point, contracts will be exchanged for the relevant property. This will trigger the preparation of your loan documents and an offer by the lender. When you receive these, you should review them with your solicitor to make sure that everything is in order.

Return Signed Documents, Arrange Insurance

Once this review is completed, sign the documents and return them to the lender with your insurance details. Your solicitor will arrange a settlement date and advise all parties. Finalise any outstanding transactions and direct debits, amongst others, to ensure that monies go into the correct accounts.

Successful Settlement and Getting the Keys

Your solicitor will attend the settlement on your behalf and once everything has been finalised, you will receive the keys to your property from the selling agent. For us, this is the best part, because we get to see first-hand the excitement of our clients as they leave our office to take possession of their new home.

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