A real budget
How much should you be looking at?
A figure assessed against actual lender policy rather than an online estimate, so you search inside a range that will hold up when it matters.
PRE-APPROVAL
Know your ceiling before you start looking
Pre-approval tells you what a lender is likely to do. It is genuinely useful, and it is not a guarantee.
IN SHORT
Pre-approval is a lender's conditional indication, not a commitment to lend
A lender reviews your income, commitments and credit history and indicates it would be prepared to lend up to a certain amount, subject to conditions. The most important of those conditions is the property itself, which has not been assessed yet.
It is worth having. It tells you your realistic budget, it stops you wasting time on properties out of reach, and it signals to agents that you are a credible buyer rather than someone still working it out.
It is not the same as formal approval, and treating it as though it were is how buyers get into trouble — particularly at auction, where contracts are usually unconditional.
WHY IT HELPS
What pre-approval gives you
Credibility with agents
Does it help your offer?
An agent weighing two similar offers will favour the buyer whose finance is further along. It can matter in a close negotiation.
A faster path afterwards
Does it speed up the real approval?
Much of the assessment work is already done, so moving from pre-approval to formal approval is generally quicker than starting cold.
HOW IT WORKS
What is still outstanding after pre-approval
Understanding what remains conditional is the whole point. A pre-approval can be withdrawn or reduced, and buyers occasionally discover this at the worst possible moment.
- The property must be acceptable security and must value up
- Your circumstances must not change — a new job or new debt can undo it
- Pre-approvals expire, commonly after around three months
- Some are system-generated rather than assessed by a person, and are much weaker
- Lender policy can change between pre-approval and application
IS IT RIGHT FOR YOU
Using pre-approval sensibly
This tends to suit you if
- You are actively looking — get it when you are ready to search, not months beforehand.
- It has been assessed by a person — a fully assessed pre-approval is worth far more than an automated one.
- You keep your position stable — no new debts, no job changes, no large unexplained transactions.
- You understand the conditions — so nothing outstanding comes as a surprise.
Worth weighing up
- Auctions are unconditional — pre-approval alone is not a safe basis for bidding without advice.
- The valuation can still fall short — which changes what the lender will actually advance.
- It expires — and renewing may mean fresh documents and another credit enquiry.
- Multiple applications leave a trail — repeated enquiries can affect how lenders see you.
How working with us actually goes
Step 1
We start with a conversation, not an application
Step 2
We work out what you can borrow and what it costs
Step 3
We prepare the application and deal with the lender
Step 4
We stay across the loan long after settlement
COMMON QUESTIONS
Questions we get asked about this
How long does pre-approval last?
Typically around three months, though this varies by lender. Some can be extended, usually with updated payslips and confirmation that nothing has changed.
An extension may involve a further credit enquiry, so it is better to obtain pre-approval when you are genuinely ready to buy.
Can I bid at auction with pre-approval?
You can, but understand the risk. Auction contracts are generally unconditional, and pre-approval does not cover the property, which has not been valued or assessed yet.
If you intend to bid, talk to us and to your conveyancer first so you know exactly where you stand.
Does pre-approval affect my credit score?
A fully assessed pre-approval usually involves a credit enquiry, which is recorded on your file. One enquiry is not generally a concern.
Several across different lenders in a short period can be, which is why it is better to apply once, to the right lender.
Can pre-approval be withdrawn?
Yes. It is conditional, and it can be reduced or withdrawn if your circumstances change, if the property is not acceptable security, or if the valuation comes in low.
Avoiding new debts, job changes and large unexplained spending between pre-approval and settlement is the practical advice.
Is an online pre-approval the same thing?
Often not. Some are automated indications produced by a system with limited verification, and they carry much less weight than a pre-approval assessed by a credit officer who has reviewed your documents.
It is worth knowing which kind you have before you rely on it.
RELATED
Where people usually go next
GET IN TOUCH
Ready to find out what you can actually borrow?
Would rather talk it through?
(02) 9659 1694Important information
The information on this page is general in nature. It has been prepared without taking your objectives, financial situation or needs into account, so it is not personal advice and you should consider whether it is appropriate for you before acting on it.
Any rates, figures or examples shown are indicative only. Lending is subject to approval, and lender eligibility criteria, terms, conditions, fees and charges apply. Talk to us about what your own circumstances allow.