Getting a home loan takes about 4-6 weeks, from application submission to settlement. This, of course, could vary depending on the complexity of your loan or the type of lender you are applying with.
To ensure your home loan gets approved without delays, you must first make yourself aware of the various phases in the home loan application process. Then, you can look into how to speed up the process.
How Long Does It Take To Get Home Loan Approval?
| Application Process | How Many Days Does It Take |
|---|---|
| Filing an application | 1-2 hours |
| Pre-approval | 1-3 business days |
| Application | 4-7 business days |
| Property Valuation | 3-5 business days |
| Unconditional approval and settlement | 4-6 weeks |
Please note that this is a general guideline. Lenders can take more or less time, based on the complexity of the application and the information required.
Steps In The Home Loan Application Process
1. Filing An Application
The first step is to file an application for your home loan with a lender of your choice.
Whether you’re a single applicant or applying with someone else, it typically takes about 1-2 hours to fill out an application form. If you apply with a lender through a mortgage broker, the process can be quicker and easier.
Depending on the complexity of your loan, the turnover time for your application will be either 1-3 days or 4-7 days.
Our mortgage brokers have direct access to a lender’s business development manager. For complex cases that take longer, apply through one of our brokers to reduce the turnaround time to 5 days or even 3 days.
2. Getting A Pre-approval
As someone looking to get a home loan as soon as possible, you should go for a pre-approval. A pre-approval gives you the confidence to go looking for a property mid-application. Knowing how much loan you have been approved for helps you set a budget.
But you must be aware of time constraints. You must find a property within 90 days of the issuance of pre-approval or it will expire.
3. Applying For Valuation
Once you find a property, you must apply for a valuation with the lender.
If you’re borrowing at 80%, some lenders will just go off the contract of sale and give you a formal approval.
Some will conduct a kerbside valuation, just to confirm that there is a property located at the address provided.
In this case, you could potentially hear back from the bank with your formal approval the next day.
If a full valuation is required, it could take as long as 3-5 business days, depending on how quickly the vendor or real-estate agent allows access to the property.
4. Getting A Formal Approval To Settlement
Once a valuation has been undertaken and you’ve been formally approved, you can sign the contract of sale, with help from your conveyancer.
At this stage, you should negotiate the settlement date.
The time between getting formal approval and signing the contract of sale will come down to how organised you and the vendor are. Typically, the vendor’s conveyancer will send the contract of sale to your conveyancer and you’ll then organise a date to have a meeting to discuss the terms. Expect this to take 1-2 days so you’re not rushing into the sale.
Meanwhile, the bank will prepare the loan offer documents for you to sign.
This can take anywhere from 2-7 days! During this time, the lender may ask for additional or updated documents, so be prepared.
It’s important to sign and return the loan contract as soon as possible.
You can find more useful information about buying a property on the Home Buying Process page.
12 Steps To Home Loan Approval And Beyond
Your Step-By-Step Roadmap From Applying For A Home Loan To Finally Moving In
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What Is Conditional Vs Unconditional Approval?
Pre-approval and conditional approval are similar but not exactly the same.
A pre-approval means a lender is willing to let you borrow the money but you need to find a suitable property. If the property is not accepted by the lender, you will not be approved for the mortgage.
A conditional approval means there are some conditions the borrower needs you to meet before the lender is confident to move your application forward. For example, the borrower might need to close out a credit card or work more hours to get approved.
An unconditional approval is a formal approval. As the name implies, there are no conditions you need to meet. The lender is ready to move your application forward to settlement.
You can visit our page on conditional vs unconditional home loan approval for more information.
How Can I Speed Up The Home Loan Approval Process?
Below are steps you can take to speed up your home loan process, so you get a fast home loan approval.
Get Pre-Approved First
Before you start house hunting, secure a pre-approval for your loan. This gives you a clear idea of your budget and shows sellers you’re serious. Once you’ve found the perfect property and have a signed Contract of Sale (COS), your loan can progress to formal approval. This ensures a smoother and faster process, helping you avoid any last-minute surprises.
Apply With The Right Lender
Some lenders over-promise and under-deliver when it comes to turnaround times.
A bank trying to win over a customer has a strong incentive to guarantee approval before a certain date, even if it is unrealistic. This is particularly true for low-cost lenders or banks that are advertising an interest rate that is way below the rest of the market.
We can find the right lender for you from our extensive panel, so you don’t get stuck with a bad one.
Avoid Getting Missing Information Requests
Around 80% of home loan approval delays result from missing documents.
By providing up-to-date mortgage documents with your application, all in one go, you can drastically reduce the time taken to reach home loan approval.
The most important documents to be sent include:
- A completed fact find or short application form.
- A scanned copy of your driver’s licence, passport or Medicare card (whichever is applicable).
- Your two most recent payslips, or your last two years personal tax returns and financial statements if you are self-employed.
- A copy of the contract of sale (you need to provide the first couple of pages in most states).
- Read each mortgage document carefully. Provide all the documents that the bank asks for the first time around.
- Make sure the supporting documents are up to date.
- Sign the mortgage documents and return them as soon as you’ve agreed to the terms.
- Notify the vendor or real-estate agent and tell them whether they need to allow access to the property for a valuation.
4 Tips For Quicker Settlement
Below are some additional measures you can take to reach settlement quicker.
Get Help From Home Loan Experts
At Home Loan Experts, our mortgage brokers can access priority services with select lenders, including major banks. This means faster turnaround times, quicker approvals, and shorter settlement periods for your home loan. Call us on 1300 889 743 or complete our free online assessment form and discover how we can get your mortgage application approved faster and get you into your new property hassle-free.