How long does it take to get pre-approved or a loan offer from a bank? The answer will surprise you.
The stock standard answer is around 5 working days for any of the mainstream lenders. Sometimes you get lucky and can hit a quiet patch, but the best I have seen recently is 3 working days.
What is NOT talked about much is the lead in period. So you are on the lookout for a decent mortgage adviser and you remember that one of your friends recently used someone they were thrilled with, so you think great I will phone them and ask for the name of their Adviser. It is 10am.
What you don’t know is they are in meetings all day and their phone is turned off. Anyway you wait until 2pm and then try texting, still no reply. You have already signed a sale and purchase agreement with a 5 working day finance clause, so the clock is ticking.
Now you go into a meeting and can’t do anything until 4pm. 4pm comes round are you are starting to get a bit anxious so you jump on Facebook and also phone your accountant and solicitor. To-day of all days everyone is busy.
You don’t want to go home to your partner and tell them that you have been unable to find anyone so Facebook it is and you hope that the person is good, as you have never used this channel before. Especially for something as important as a mortgage.
9pm- So you have finally found THE RIGHT PERSON . Now the work starts. You are asked for paperwork this and paperwork that. Do the banks really need all this you ask yourself, after all they are large organisations and the amount they are lending me is only $500,000, which is nothing to them.
Anyway, by 12 Noon the next day you think you are doing well and have given the mortgage adviser 90% of the paperwork. Why can’t he/she submit the loan application and give me time to find the last piece of paper, you think.
Unfortunately it isn’t as simple as this, as the bank will not process your loan if all the paperwork isn’t there and they hate having to ask for missing information and put your file at the bottom of the pile.
So you go home that evening and spend 30 minutes trying to find out the missing bits of paperwork required. Great got it, so you send it through to the Adviser who then comes back the following day, around lunchtime, saying that he needs some further information before he can submit the loan. End of day 2 of the 5 day finance period and the loan still hasn’t been submitted.
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