Quick Tips To Increase Your Chances Of Your Home Loan Getting Approved!
How to Increase Your Chances of Home Loan Approval
Back in the day, getting a home loan was rather simple. In most cases, all you had to do was wait for your application to receive the stamp of approval and you were set to go.
Nowadays, however, given the volatility of the property market and the overall instability of home prices, it’s only natural that home loans are harder to get approved.
Still, you can do a couple of things to increase your chances of home loan approval – just pay attention to the following information.
Watch the Limits of Your Credit Card
People with huge credit card limits will give lenders some time to think about their home loan – as well as some issues when approving it. It is recommended that, when looking for a house, you decrease your credit card limit or close any debt you can. Having less debt classifies you as less risky and also increases you borrowing power..
Three Months of Living Expenses
As you know, some lenders and your broker will want to see your three months of living expenses when you apply for a home loan. In such circumstances, you have to start thinking like a lender six months before you apply for a home loan.
If you do so, you have the opportunity to assess your expenses and rectify your spending habits so that you turn yourself into a proper recipient for a home loan.
Any unhealthy spending habits may seriously decrease the chances of getting your home loan approved.
Lenders simply love those people that can show their ability to manage their expenses and save money. This is because, for a lender, you saving money means that you can, in fact, put money away to repay your loan.
On top of that, it also means that you can use your savings as a part of your contribution to the purchase of your new home, especially If genuine savings are required. And, as you know, the larger your contribution, the less you need to borrow – therefore, the risk a lender takes by approving your home loan decreases.
Postpone Career Changes
Let’s say, for example, that you found a new job or a new way to earn income to support the purchase of your new home – as well as the ability to take out a loan. Even though your income would be boosted by doing so, keep in mind that lenders want proof that you can hold down a job.
On the other hand, if you’ve just started a new venture – as in a new job – you shouldn’t worry too much either. Lenders will take a look at your entire job history and determine if you are fit to take out a loan or not. They usually want to see 3 years of employment as a bare minimum and having multiple short term jobs may show the lender you cannot keep a job and have no stability, try avoid this.
Still, it is recommended that you postpone any significant career changes until you either have your loan approved or you finish paying it off.
The Bottom Line
Overall, getting a home loan approved can be tricky. You have to be aware of your entire financial situation and not only – past, present, and future will be analysed by lenders as well.
Long story short, you want to prove to your lender that having your home loan approved will not put them at risk and that you will be able to meet your monthly loan repayments.
If you need any help regarding your home loan approval, you can always contact us. Our team of experts will help you find the best loan for your needs and will also give you advice on how to ensure its approval.
So, why use Highline Lending for your home loan?
We meet for a consultation, obtain your supporting documents and proceed to structure and package your application for approval knowing exactly what the banks want to see. We also monitor your home loan post approval ensuring you’re home loan suits you and your financial position
We get paid a commission from our lenders as a result of introducing your business to them. Subsequently, our service is at no cost to you. Our commission does not affect your interest rate whatsoever, if anything, we’re in a position to get you a lower interest rate than the general public due to our relationships with our banks
With our many years experience in the industry, we’ve been exposed to both easy and complex loan scenarios. Each loan we process gets presented to over sixty financial institutions, ensuring we have explored all options possible and are able to provide a solution