Having found the best possible deal, it's time to apply for a home loan, attend a loan interview and get approval. Make sure you have all the necessary documents ready for your lender or broker.
Procedures vary from lender to lender, but it is likely you will be issued with either a 'home loan guarantee certificate' or a 'pre-approval certificate'. This means that, subject to a few conditions, your home loan either has been, or will be, approved when you find the properly you want to purchase. One of the main conditions is often a valuation of the property to ensure a buyer isn't paying too much for a property.
Loan approvals don't last forever. They typically are valid for around six months, but sometimes up to 12 months. If you find your pre-approval has expired or is about to, Contact the lender or broker and see if it can be extended or if you have to re-apply.
You should not exchange contracts for the properly (with or without the cooling-off period) before finance has been approved in writing. With your formal application you will usually have to pay fees to the lending body, such as establishment and valuatIon fees. The lending body will value the property to determine whether the properly is adequate security for the amount of the loan.
The lending body lends a percentage of the valuation of a property, not a percentage of the purchase price.
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