In particular we focus on getting the loan structure right the first time, choosing which lenders to use in the right order (yes this is important) and finally getting our clients the best deal possible.
AIP (Approved in Principle)
AIP (Approved in Principle) is an approved loan application made before a property is purchased.
A lot of lenders do these through automated software checks with no manual review. This means AIP’s can be issued very quickly, and almost automatically. You can get the AIP fully assessed by requesting a manual assessment as this looks at whether everything has been disclosed (like the HECS debt you forgot about or that buy now pay later facility you opened once but didn’t close), that all the documents provided meet the lending policy (pay slips within a certain time period etc) and that your credit history is good order. Not all lenders offer fully assessed preapprovals though, if you need the assurance you can get the loan, let your mortgage broker know that this is important to you.
There is never a 100% guarantee you’ll be fully approved until a lender knows exactly what property you’re buying – and at what price.
A lending specialist will also look at your requirements and objectives, along with your current financial situation and will ask:
- Who you are? You will need to provide ID.
- How much you earn? This includes your salary, investments or rental income.
- How much you own? They will evaluate all of your assets, including cars, jewellery, shares and savings.
- Do you owe money? From a car lease to credit cards, you’ll need to declare any debt or loans you currently have.
- What are your living costs? They will look at your monthly expenses groceries, bills, transport and lifestyle to help estimate your loan.
- What type of properties you’re looking at? They will need to know the suburbs you’re looking at, property type and size to ensure it’s a good investment for them too.
Approval in Principle (AIP) means the bank has agreed to extend you the funds for a home loan, subject to a valuation of the property. In summary, both terms mean roughly the same thing, which is that your lender has agreed in principle to lend you a certain amount of money toward the purchase of a property. Unlike Pre-approval, In-principle approval requires a full credit assessment and responsible lending assessment. Your lender will look at your current financial situation and ask for formal identification, your income, assets, debts, your costs of living etc.
Learn MoreWhile you're looking for a property, the approval in principle (AIP) normally lasts three to six months and gives you an estimate of how much money you can borrow at that time. Before you put in an offer on a house, call your bank and request a letter of offer.
Learn More
