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Get $2,000 in your pocket courtesy of Compare the Market when you successfully apply for a home loan through our new loan comparison and application tool. If the lender you apply with is also offering a cash bonus for settled home loans, you’ll get that as well!
Checking your credit score, borrowing power, and general financial situation are invaluable first steps in the home loan application process – and you can do all of them with us for free and in the one place from your personalised home loan dashboard.
Learn moreOur meerkat technology will take the information you provide as part of your initial comparison and use it to show you the home loans you’re eligible for (based on eligibility criteria).
Learn moreWhether you’re chasing a fixed-rate, variable-rate, investment, or interest-only home loan, you can search for it via our service.
Learn moreWhether you need help with your application or have a home loan question, our Home Loan Specialists are here to help.
Learn moreRedraw facilities, offset accounts, repayment flexibility – whatever features you’re looking for, you’ll probably find a home loan that comes with them on our website.
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The average Australian probably hears the phrase ‘home loan application process’ and shivers because, well, it’s not one that fills most people with excitement! Or at least that’s been the case historically – not any more though thanks to Compare the Market’s new home loan application service. Not only does it make comparing your options an absolute breeze, but once you’ve settled on a home loan you’re happy with, you can apply for it then and there! In the exact same place that you found it.
Before you get started, you’ll want the following at hand; Your MyGov ATO login in (for evidence or your income) or your last three payslips, Your driver’s licence and passport (or ImmiCard) Once you’ve got those together, step one is completing the online application. This will require you to provide information regarding what you are looking for in a loan and what you want a loan for, along with your personal details and financial circumstances. Once you’ve verified your identity, Compare the Market will run a provisional suitability check for you against the lenders in their database, and submit an application on your behalf if there’s one you think might be right for you.
Once you’ve done that, it’s time to get stuck in. Note that we’ll be going through the process for taking out an owner-occupier home loan using the new tool – if you’re after an investment home loan or want to refinance an existing loan, the process shown may vary slightly. First, let’s go through your goals and objectives. Like I said earlier, it’s important that you know what you want before you begin the application – otherwise the process could end up taking longer than it has to.
You’ll then reach a screen where you are asked to nominate how much you are thinking of paying for the property in question. If you’d like a bit of a steer here, you can click the ‘get market price estimate’ button. This will give you an estimate of what the property could be worth at market, along with a confidence rating for that estimate and a potential price range for the property. Once you’ve answered that question, you’ll be shown a summary of your answers so far.
Give it all a once-over to make sure it’s all correct, and then it’ll be time to talk about your loan. Alright, time to provide some information about the home loan you’ve got in mind. You might not have thought about some of these questions before, and that’s ok – have a think about them, maybe chat to one of the on-call Home Loan Specialists if you have any questions! First will be your preferred loan term – if you’re taking out a new home loan the standard answer will typically be 30 years, but if you’re refinancing you might want to think about this one.
Next, do you want to start out making principal and interest repayments or do you want an initial interest-only period? Ok this is a big one – do you want a variable rate or a fixed rate to start out? Next, do you want to make your home loan repayments on a weekly, fortnightly, or monthly basis? The initial instinct may be to simply line this one up with however often you get paid, but keep in mind that you’ll usually save on interest the more frequently you make your home loan repayments.
It’s time to pick your home loan features! Offset accounts are a great example – before you click yes or no, consider that having an offset account attached to your home loan will typically drive up your regular home loan costs; be they annual or monthly. Redraw facilities on the other hand, typically don’t cost anything to have on your home loan. Onto your deposit – how much have you got, and where is it coming from?
You’ll need to have genuinely saved at least 5% of the loan value, but the rest could come from a few different places: Also worth noting even cash gifts and inheritances can actually count as ‘genuine savings’ if you can hang on to them and continue to save them for three months or longer after you first receive them. Once you’ve told them what your deposit looks like, you’ll be shown a summary of your loan scenario based on the answers you’ve given. You’ll also be given an estimated required loan amount, and what your loan-to-value ratio would be. It’s worth noting that those estimations will factor in a variety of upfront buying costs including conveyancing costs, stamp duty, title transfer and mortgage registration fees, and inspection fees – among others.
If your deposit is less than 20% of the total loan amount plus these upfront expenses, you’ll be warned that you’ll likely have to pay Lenders Mortgage Insurance. If everything detailed on-screen in the loan scenario looks good to you, it’s onto the next section – applicant details. Alrighty! It’s time to tell them about yourself in more detail.
If there are co-applicants, each one will have to answer these questions. Thankfully they are all fairly simple, so it shouldn’t be much of a hassle either way. Eventually you’ll make your way to a screen asking you about your profession. If you’re an accountant, or a legal or medical professional, some lenders may offer you an LMI waiver and/or a reduced rate.
If you are none of those however, you can just click ‘other’ and then specify what it is you do when prompted. You will soon reach a screen with questions regarding your credit history and financial situation, as well as any future plans you might have that could affect your financial situation. If the answer to any of these questions is ‘yes’, you’ll be asked to provide details explaining the nuances of the situation. Following that, you’ll be shown another summary screen displaying your answers to the latest batch of questions.
Again, check these carefully! If you’re content that everything is correct, we can move on. You are exempt from this next bit if you don’t own an investment property, but if you do, you’ll have to provide information on the property, its value, the rent you earn from it, and the mortgage against the property if there is one. You’ll then be shown another summary screen displaying all the details you’ve provided regarding your investment property.
Check it all for accuracy, and once you’re done you can move on.
– Next up are your assets, liabilities and income. You’ll be shown a screen for each of these, and asked to provide details – for example, your assets will include things like vehicles or investments. Your liabilities will include any credit cards, any other loans or a HECS debt, and for your income you’ll want to call out any regular investment returns, government benefits, or child support payments in addition to your PAYG income. What matters is the accuracy of the numbers you provide, so be sure to double-check them – don’t just ballpark it!
Next, you’ll be detailing your expenses. And here’s where you can take advantage of the Compare the Market’s clever link to your financial institution. Connect up to your credit cards and bank accounts, and it’s job done! Or if you’d prefer you can manually fill out your expenses.
If you elect to fill out your expenses manually, you’ll be given a list of categories – food and groceries, rent, transport, things like that – and asked to give a dollar value per month for each one. This part is important so best to be specific and accurate here to avoid tricky questions down the track. Onto Verification of Identity, or VOI for short. Your nominated mobile number will already be listed on-screen, and to complete this step, you’ll just need to select your mobile number and click ‘send link’.
You’ll then receive a text containing a secure link taking you to the identity verification process. On your phone you’ll be required to provide your identity documents with the most common being your passport and Australian Drivers Licence. ImmiCard or proof of age cards are also acceptable. You’ll be required to take photos of your identity documents in line with the on-screen directions shown on your phone, and then confirm that the system has read the alphanumeric details correctly.
Once that’s done, you’ll be asked to take a selfie – make sure your head fits within the outline on screen, and don’t forget to smile! Once complete you’ll be directed back for the next step of the process. You are in the home stretch! All that’s left for you to do is upload your supporting documents as listed.
This could include your most recent payslips and bank statements. Once you’ve provided the required documents, your initial application can be submitted by clicking the relevant button. You’ll then be shown a provisional list of the lenders and home loan products you might be eligible for. If you like the look of one of them specifically and want to apply for it, one of Compare the Market’s Home Loan Specialists will begin the process of verifying the information you provided as part of your home loan application.
This could take a few hours or it could take a full 24. If your Home Loan Specialist determines that you are eligible for your chosen home loan and that the loan is in your best interests, you will be sent a Credit Proposal and Summary of Requirements document which provides an overview of your personal circumstances, goals, objectives and, of course, a suggested lender and product. It’ll then be on you to review the form, make sure everything’s in order, and sign off on it via DocuSign. And then that’ll be that!
Compare the Market will send your application to the lender for you, meaning you can simply sit back and look forward to receiving a formal loan approval. The time required to process a home loan application will vary by lender, but it’ll usually take a few business days. Nice work! You’ve completed a home loan application with the help of Compare the Market.
If you have any questions along the way, remember their team of Home Loan Specialists is only ever a call away, so don’t be afraid to reach out. Goodbye, and whether you are buying or refinancing, congratulations on finding a great deal on a new home loan.
Our General Manager of Money, Stephen Zeller, has some tips for prospective homebuyers to help them prepare for the process of applying for a home loan with Compare the Market:
You may want to consider paying off any existing debt such as a credit card or personal loan before applying for a home loan. This will reduce your overall commitments which in turn will increase your borrowing power.
Your credit score plays an important part in your home loan application. Obtaining our free credit report provides an insight into any missed payments you may not be aware of.
Gather useful documents like recent payslips, home loan and credit card or bank statements, and identifying documentation like a passport or driver’s licence before you start your application.
Whether you’re a first home buyer, a next home buyer, buying an investment property or looking to refinance, take time to think about your financial needs, priorities and what you might want from your new loan.
Some key points to consider include:
You may also want to get a preliminary idea of your borrowing power, and think about what type of home loan might be best for you. For example, you may like to consider whether you’d prefer a fixed or variable rate home loan.
You can also use our credit score tool to run a free credit check and see how your credit score is going. We can also help with a free property valuation report for the property you’re hoping to buy to get you an approximate value and inform your proposed purchase price.
Depending on your estimated borrowing power and financial circumstances, you may take a step back and assess your financial situation or save some more money.
However, if you’re happy with your findings, it’s time to begin your online application!
Once you’ve decided on the type of home loan product and loan amount you want to apply for, it’s time to start pulling together the information and supporting documents you’ll need for your home loan application. These are crucial to your application, as they’ll provide a comprehensive picture of your overall financial situation, including your income, regular expenditure and what you can afford in regular home loan repayments.
You’ll want to be as thorough as possible when collating this supporting documentation so you can include any relevant information for your home loan application.
Our Home Loan Specialists will be able to advise you on what to include and the level of detail required by lenders when it comes to your home loan application.
Once you’ve gathered your supporting documents and information, it’s time to start your home loan application with the help of our online home loan service.
You’ll be required to answer a series of questions regarding:
Once you’ve answered those questions, you’ll just have to complete our online identity verification process and upload some supporting documents, like tax returns, income statements and an employment contract – and you’re done!
Based on the information you provided earlier, our meerkat technology will present you with a provisional list of the home loans and interest rates you might be eligible for (be sure to check the comparison rates as well!).
Once you’ve chosen the home loan you’d like to apply for, all you have to do is submit your application and one of our Home Loan Specialists will work hard behind the scenes to review the details you’ve provided.
If the Home Loan Specialist determines that you’re eligible for your chosen home loan based on the relevant lending criteria, and that the loan in question is suitable for you, you’ll be sent a pre-filled, “Summary of Requirements and Credit Proposal” document. All you’ll need to do is review the form, make sure the details are all correct and digitally sign it via DocuSign.
Your Home Loan Specialist will then send off your application and loan documents to your chosen lender, meaning all you have to do is wait to hear back – the time it takes to receive a response will vary by lender, but will usually be at least a few business days.
If your application is successful, we’ll let you know that the lender has given final approval for your home loan. Nothing’s legally binding yet, but you’ll have a conditional approval in place, and you’ll be able to consider your home loan application successful at this point, and the approval process just about over. Your Home Loan Specialist will then guide you through the loan contract signing process and arrange settlement, which is where you’ll deal with the contract of sale and transferring ownership from the current home owner to yourself.
Stephen has more than 30 years of experience in the financial services industry and holds a Certificate IV in Finance and Mortgage Broking. He’s also a member of both the Australian and New Zealand Institute of Insurance and Finance (ANZIIF) and the Mortgage and Finance Association of Australia (MFAA).
Stephen leads our team of Home Loan Specialists, and reviews and contributes to Compare the Market’s banking-related content to ensure it’s as helpful and empowering as possible for our readers.