Pre-Approval & Borrowing Capacity

Pre-approval is a conditional indication from a lender — based on the income, assets, liabilities and deposit you have disclosed — of the maximum amount they would be willing to lend, subject to property valuation, final credit assessment and any specific conditions attached. It is not unconditional approval. Pre-approval is typically valid for 3–6 months depending on lender, and is usually subject to the actual property satisfying the lender's valuation and policy.

In most cases yes — it sets honest expectations about price range and gives confidence to make an offer or bid at auction. There are situations where pre-approval is not the right first step (e.g. when borrowing capacity is clear and the application is fast to assemble at the time a contract is signed). We confirm what makes sense at scoping.

Yes — a formal pre-approval generates a credit enquiry on your file. A single, well-prepared application to a shortlisted lender is usually a minor event. Multiple applications to several lenders in a short period can be reflected differently across credit-bureau models. The practical implication: do not run multiple lender enquiries in parallel. We pre-assess your shape against the most-likely lender before any formal credit-file enquiry.

Each lender applies its own assessment: income types and how they are evidenced; expense verification using HEM benchmarks and declared expenses; existing liabilities (home loans, credit cards, car loans, HECS, business facilities); deposit size and savings history; credit conduct; loan term and structure; and a serviceability buffer rate. APRA-regulated lenders apply a buffer of at least 3 percentage points above the actual loan rate. Two lenders can reach materially different figures for the same applicant; the difference is policy, not preference.

Typically 3–6 months depending on lender. If you do not find a property in that window, the pre-approval can usually be extended on confirmation that your circumstances have not changed. A material change in income, employment, liabilities or credit conduct may require a fresh assessment.

For PAYG applicants: photo ID, last 2 payslips, last 3 months of bank statements for accounts holding the deposit, debt statements (credit cards, loans). For self-employed applicants: last 2 years of personal and business tax returns plus Notices of Assessment, last 4 BAS lodgements, 3–6 months of business bank statements, and the same identity and deposit documents as PAYG. Trust and company applicants add the trust deed or constitution and director/trustee details.

Yes — sometimes by a significant margin. Differences arise from each lender's treatment of bonuses, overtime, secondary income, rental shading, business add-backs, business debts (face value vs notional vs excluded), HEM benchmark, expense floors, and assessment rate. The right lender is the one whose policy fits your income shape, not the one with the lowest headline rate. We document the lender shortlist and the policy reasons in writing.

No. Borrowing capacity can change after lender verification, property valuation, credit assessment, policy changes, interest-rate changes or changes in your circumstances. Pre-assessment and pre-approval are not final approval. A pre-approval modelling figure is a written estimate based on the documents you provide and the policy of a specific lender; the lender's own assessment is the binding outcome. Eligibility, lender criteria, fees and charges apply to every application.