Getting your loan approved in principle, especially if you’re looking to get pre-approved, can be an unnerving experience. Not only do you have to prepare all the required documents for the bank, you also have to find out your loan-to-value (LTV) ratio, which determines whether or not you’ll be able to get the loan in the first place. If you’re ready to jump into the housing market but not sure where to start, here are tips that will help get your loan approved in principle in Singapore so you can buy your first home without hassle.
1. Be Professional
When you apply for a loan and get pre-approved, be sure to include all the necessary documents that will support your application. If your home purchase is funded by a bank loan, make sure that your bank has approved the loan. In this way, you can avoid communication problems between various banks when looking for a mortgage.
2. Don’t Forget to Prepare the Appraisal
Many pre-approved home buyers do not know that they need to have a home inspection before closing. Many financial institutions may require two or three appraisals, depending on the level of firmness in their lending criteria. The first appraisal must be done by a licensed and insured professional, so make sure that you find a reliable and reliable agent who is familiar with land surveying. This way, you can avoid unnecessary delays in the process of buying your new home and enjoy your “dream” of owning your own house sooner than expected.
3. Don’t Forget to Prepare the Down Payment
When you pre-approved for a loan, you may assume that all the money that you need for this project is ready and waiting for you. However, in order to get your loan approved in principle, it’ll be necessary for you to contribute a down payment of at least 7.5% of the purchase price of your home. If your down payment is lower than 7.5%, it’s possible that your loan will not be approved in principle. The required down payment may vary depending on the mortgage provider and the type of loan being applied with them.
4. Don’t Overcommit
If you are a first-time home buyer, you may not want to purchase a house that is more expensive than the one that you can afford. Thus, it’s important to set your budget accordingly, and don’t forget to consult a mortgage broker to help you determine the right LTV ratio for your loan. Ask your bank or mortgage broker about the type of financing schemes available, so you can get pre-approved for whichever option best fits your financial situation.
5. Don’t Rush the Process
When looking for the best loan provider in Singapore, make sure that you do not rush into this decision. The timing of purchasing a house is crucial, so make sure that you get pre-approved for a mortgage before you enter the market and choose your dream house. If you have to save up for your down payment too early, it could take longer for you to qualify for financing than anticipated. That’s why it’s very important that you can choose the type of home loan best suited to your financial status.
It’s important to have a professional team of people who will help you through your loan application process. Your mortgage broker and mortgage advisor are essential in making sure that your loan is approved in principle. This will save you time and money, especially when coping with financial complications that occur during the home purchase process.