Buying a home can be daunting….there’s real estate agents, valuers and lawyers to deal with, insurance, power, and internet to sort out, boxes to pack and move, not to mention the dreaded home loan application.

Applying for a home loan can seem like a lot of hard work and a bit overwhelming but once you understand the process it’s really quite simple.

Step 1 – The Application

The first step in the home loan process is the application.

The application is designed by the lenders to get all the information they need to be able to access whether or not they’ll get their money back if they lend it to you.

They’ll look at whether you can comfortably afford to meet the repayments of the home loan and whether you are a good ‘risk’ and whether the property is a good ‘risk’.

The type of information you’ll be asked to provide in the application can include:

- basic information about yourself
- solicitor and insurance details
- your assets and liabilities
- your income and expenditure
- how much you’d like to borrow and how much deposit you have

Step 2 – Supporting Documentation

Once you’ve completed the application form the next step is to provide supporting documentation. It’s all very well to say this is how much you earn but the lender is going to want some proof.

The type of documentation you’ll need to provide may vary but in general you’ll probably need to provide:

- Some form of identification like your passport or driver’s license
- Proof of your current address like a bank statement or power bill
- Two recent payslips
- Bank / Visa statements for the last 3 months
- A Registered Valuation
- A Sale and Purchase agreement

So that’s it, your application is done and with the lender.

Step 3 – Waiting!

The final step in the process is…waiting!

This can sometimes seem like the hardest step off all, especially when your dream home is on the line!

Once they receive the application the lender will check it and will also do their own ‘due diligence’ on you and the property (for example: a credit check.)

There are a variety of things that can affect how long it will take to hear back from the lender but a good rule of thumb is to allow between 3 – 5 working days.

So that’s it, as easy as 1, 2, 3!

The information contained in this article is of a general nature and should not be taken as advice. It reflects the opinions of the writer only and does not necessarily reflect the opinions of New Zealand Home Loans (NZHL).