How long does it take to get your home loan approved?

By Maria Gil and Evlin DuBose
Fact Checked
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Person checking their home loan application approval illustration

Waiting for your home loan application to be approved can generate a lot of anxiety, particularly in a competitive market when your dream property can slip through your fingers if your bank is taking too long.

Some lenders put their average unconditional approval time at four to six weeks, while others claim they can give a customer an application outcome the next day. While there’s no clear-cut answer to how long the home loan process will take, there are things you can do to help speed it up.

How long does it take to get home loan pre-approval?

Before lenders can grant you unconditional approval, you’ll need to go through the process of obtaining pre-approval. This is a statement indicating how much a bank is willing to lend you based on your current financial situation.

This stage tends to last between 3 and 5 days. That said, it might take longer depending on the lender, your borrower profile, and the complexity of your application. For example, your loan application might be subjected to much more scrutiny if you:

  • Have a high loan-to-value ratio
  • Have non-typical employment
  • Are a non-resident
  • Are borrowing with a guarantor
  • Are borrowing upwards of $2 million

However, many online mortgage lenders these days use technology to crunch the numbers. This way, some lenders such as Athena, Unloan, and Up claim to give you conditional pre-approval for your home loan in minutes. 

How long does it take to get unconditional approval?

Once you’ve made an offer on a property and the vendor has accepted it, you can now apply for unconditional approval. At this stage, your lender will review all your documents and conduct all the necessary checks (such as a property valuation and credit check) to ensure you can service your home loan.

If they are confident that you can finance the mortgage, you’ll be sent a statement informing you that your home loan application has been approved. It might take as little as one day or up to a week before you receive this.

How can I speed up the home loan approval process?

If a timely home loan approval is important to you, there are a few things you can do to improve your chances. These include:

  • Apply with the right lender
  • Make sure all your paperwork is in order
  • Sign and return forms as quickly as possible
  • Make sure you’re a good borrower and don't have any red flags. 

Mistakes on your application or red flags lenders don't like can all slow down your approval process. As a rule, it's easier to lessen drag than to push harder, so comb through your home loan application for problems, prepare your finances, and consult a financial adviser to make sure you're ready for approval. 

Apply with the right lender

At the end of the day, no bank will grant you a home loan without evidence you can pay it off. But even if you can comfortably service a mortgage, some banks will make you jump through more hoops to prove it.

For example, a newer lender might request more documents and in general be far more cautious than one of the major banks. That’s because a customer defaulting on their home loan will have a greater impact on a smaller player than a larger, more established one.

Make sure all your paperwork is in order

Sometimes, the application process is drawn out because lenders don’t have all the information they need. To save yourself time, make sure you provide all the necessary documents upfront.

Some documents your lender will require include:

  • Identification
  • Proof of employment
  • Pay slips
  • List of expenses
  • Details about income from other sources (e.g. interest and dividends)
  • Details about any debts
  • Tax returns
  • Insurance
  • Offer on the property.

If part of your deposit was gifted to you by your parents, your lender might also ask for a ‘gift letter.’ This is a statement signed by your parents confirming that the funds were given to you unconditionally and there is no obligation to repay them. 

In general, try to provide as much detail as possible to avoid any back and forth requests for clarifications. For example, if you don’t drive your car much because you live close to work, it might be worth saying so in a note to the bank so they don’t inquire why your petrol costs are so low.

Sign and return forms as quickly as possible

If your lender gets back to you with requests for more supporting documents for your home loan application, try to submit them as soon as possible. The longer it takes for documents to reach the loan officer’s desk, the longer you’ll have to wait to get a verdict.

Make sure you’re a good borrower

When you apply for a loan, banks will pore over your finances for evidence that you can be a good borrower. To boost your chances of loan approval, make sure you tick the following boxes:

Frequently asked questions

Should I apply for pre-approval with multiple lenders?

It’s generally not a good idea to apply for pre-approval with too many lenders, as it gives each successive lender the impression that you've been rejected by the others. To avoid coming across as desperate for credit, research your options beforehand and try to submit applications with just two or three different lenders.

Do I have to go with the first lender who grants me pre-approval?

No. Pre-approval typically lasts for around three months before expiring. You can choose to extend it — which can be useful if you haven’t found a property yet — but there's also no penalty if you let it run out and go with another lender.

What happens if my application is rejected?

If your home loan application is denied, it means your bank determined that you cannot comfortably service a loan. While this is a major setback, it doesn’t mean you won’t be able to apply again in the future once you’re on stronger financial footing.

If buying property is on your horizon, compare home loans below.

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* WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for $150,000 over 25 years.

** Initial monthly repayment figures are estimates only, based on the advertised rate. You can change the loan amount and term in the input boxes at the top of this table. Rates, fees and charges and therefore the total cost of the loan may vary depending on your loan amount, loan term, and credit history. Actual repayments will depend on your individual circumstances and interest rate changes.

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