Getting the tick of approval for a home loan can be the first step towards owning your dream house. Your financial institution will be able to give you the exact details but it pays to be prepared. Have these documents handy to help speed up the process and give you the best possible chance of success in your application.
Personal Identification
While individual requirements may differ, having some form of personal ID is your first step. A valid passport, birth certificate and/or driver’s license is ideal although many institutions will require secondary forms of identification such as your Credit Card or Medicare Card.
Income Information
If you earn a wage or salary – You’ll likely need to provide your two most recent payslips, from within the previous 60 days, which show your employer’s name as well as your own. In addition bring your latest Pay-As-You-Go (PAYG) summary, any employment contract (if you have one) and a signed letter from your employer showing how long you’ve been employed for.
If you are self-employed – Common requirements include your two latest Personal and Business Tax returns and Tax Assessments. You may also need to show your ABN and Business Activity Statements (BAS). It is the legal responsibility of the lender to ensure you can pay back the loan, not simply rely on the security of the house itself, so you may have to prove your financial position with more certainty as a self-employed worker.
If you earn Rental Income – You may have to show a letter from the Real Estate Agent showing expected rental income for a given period as well as the lease agreement and proof of rental income via your bank records and financial statements.
Your employment and income circumstances will largely dictate the type of documents you’ll need so consult your prospective lender for more details.
Legal Declarations
Bringing the name, address and contact details of any legal representative shows a level of organisation and commitment that will only help your application.
There are also a number of statutory declarations to keep in mind such as;
- A declaration demonstrating any funds that will be given to you in the future for the purpose of repaying the loan, but not yet in your accounts.
- If you’ve received monetary gifts to be put towards the down payment you will need a signed letter (from the person giving the monetary gift) stating the funds are an unconditional gift and not expected back at a later date.
- If you’re making renovations on the property you’ll need original copies of your local council approved plans and specifications.
The exact nature of your legal documents will vary but if ID and Income combine for the skeleton of the application then your various declarations will flesh out the process further.
Special Circumstance Documents
The more evidence you have of your financial stability, the better your chances of securing your loan, so it pays to bring extras. If you have an acting guarantor for the loan (an individual who will legally be obliged to cover the loan repayments should you be unable), you should have two identical sets of documents, one in your name and one in theirs.
Home Loan Tip – Don’t be discouraged if your credit history has some black marks. If you’re worried about past debts bring a letter stating the details of the debt, the reason for your default and the amount paid/unpaid. Your honesty will help with your application.
Every application will vary depending on your circumstances. Speak to our team at Easy Plan for a list of documents you will need.