Apply For A Home Loan
Take a little time to prepare and you can make the home loan process very easy. Here are a few issues you can expect to encounter when you apply for a home loan…
You will need to provide photographic proof of identity – your driver’s licence, passport or proof of age card will suffice. You will also need secondary documentation, such as a Medicare card, rates notice or utility bills that are no more than three months old. This will apply to all applicants to a loan, including guarantors. Provide as much as you can, overkill will not be a bad thing in this area.
Income & Expenses
In their need to determine your borrowing capacity, banks and other lenders will request documents outlining your financial situation when you apply for a home loan. This may include pay-slips, bank statements and written references from your current employer. Make a list of your monthly outgoings. Your list should include everything from rent, utility bills and travel expenses to gym memberships and leisure activities. If you pay an account annually or quarterly, break it down to a monthly figure for your list.
Assets and Liabilities
Make a list and be prepared to disclose the value of everything you own and any outstanding debts you have at the time of home loan application. Collect or order 12 months worth of bank statements, including the most recent. Bank statements will include current home loan, personal loan, credit cards, store cards, savings accounts, term deposits and online savers.
Start a file
Whether you are applying for your first or tenth loan, being organized will stop you from being overwhelmed. Use the headings from my article for your file. (They are generic for all lenders.) While you may encounter some troubles along the way, coming prepared when applying for a home loan can make the whole process run a lot smoother.
About Bank Statements
Some recent experience has led me to add this little gem. It seems that some lending institution employees are fixated about bank statements. To the extent that some loan applications are being rejected if the client cannot supply all recent and consecutive statements on bank or credit union letter head. The problem for most of us now is that we get electronic statements that do not have institution details on the them. My advice now for everyone who thinks they may need to access some lending in the future is to go back to paper statements and store them in an old fashion file. Alternatively find a bank that supplies proper statements online.
Please check out my other information about home loans in Australia.