The Loan Processs
1. Consultation with Your Mortgage Broker
Your journey to securing a property loan begins with an initial consultation with Jonathan, the Principal at Total Choice Home Loans, with over 20 years Mortgage Broking experience. This can be organised online with Zoom or Teams or at the HQ office in Fremantle. Whether you're buying a first home, upgrading to a bigger home, considering buying an investment property or commercial real estate, Jonathan will discuss your property goals, explain the application process, and assess your current financial situation. This meeting sets the stage for finding the right loan options. Jonathan will also outline various loan types from banks and lenders across Australia, helping you access the best deals. To provide you with options and make the consultation a productive meeting, we will require you to provide us with some initial information so we can do some preparation. All personal information is held securely with 2FA protection and kept safe.
2. Financial Assessment
Jonathan will thoroughly evaluate your financial situation, including your income, expenses, assets, liabilities, credit history, and home equity. This comprehensive assessment is crucial to determining your borrowing capacity and the loan amount you can apply for. Your broker will help you understand key financial terms like loan-to-value ratio (LVR), interest rate discounts, and lenders mortgage insurance (LMI) that might apply based on your specific financial position. Any government incentives can be analysed and discussed at this time.
3. Exploring Loan Options
After assessing your financial situation, Jonathan and the team will compare various loan products from multiple lenders, considering your requirements and objectives with factors like interest rates, fees, repayment terms, and loan features. Jonathan will also help you understand the differences between fixed and variable loan rates, offset accounts, funding requirement, costs to purchase and the implications of each option on your future repayments. The aim is to find a loan that best suits your needs, whether you're looking for a home loan, investment loan, or a loan to fund another property purchase. We also try to educate you throughout the process so you have a better understanding of what is going on.
4. Pre-Approval Process
One of the first major milestones is receiving loan pre-approval. Most real estate agents will want to know you are ready to purchase with a valid lender pre-approval. This process involves getting an initial indication from a lender regarding how much you may be able to borrow. Pre-approval helps you set a realistic budget and gives you more confidence when making offers on properties. It also strengthens your position in the local property market, showing sellers that you’re a serious buyer. We also find this cements your conviction to be able to make the next step in making an actual offer on a property, or house and land package.
5. Submitting the Loan Application
After choosing the loan product that works best for you, Jonathan and the team will assist you with the formal loan application. They will manage the paperwork, request any necessary supporting documents such as bank statements, and submit your loan application to your chosen lender. The Total Choice Team will liaise with the lender throughout the application process, keeping you informed about the progress and addressing any issues that arise. Once you have had an offer accepted, we will work with all parties to ensure a smooth transition to formal approval and settlement. The Total Choice (TCHL) Team will work with the lender, real estate agent, settlement agent, government bodies and other parties to make sure there are no surprises.
6. Loan Approval & Final Steps
Once your loan is approved, the TCHL Team will guide you through the next steps. This typically includes reviewing the loan agreement, ensuring all terms and conditions are understood, and arranging for any additional insurance coverage, such as mortgage insurance. The team will also help you set up repayment options and advise on strategies for managing your loan effectively over time.
7. Property Settlement & Ownership
Once all the documentation is in order, the final settlement takes place. This is when the loan is formally advanced, and ownership of the property is transferred to you. Your settlement agent will be responsible for ensuring all the monies are distributed and contracts finalised with the titles changing hands on settlement day. We have several settlement agents who offer an excellent service we work closely with to ensure all communication and professional service is maintained at all times as we transition the process to them to finalise. After settlement, your lender will typically offer online access to your loan, and you’ll begin managing your loan repayments, helping you stay on top of your financial commitments. Total Choice will be able to assist with where to find the right information and depending on the lender can assist with setting up accounts. After settlement you can always check in with our team to query anything.
8. Loan reviews
Total Choice Team will periodically reach out to offer a review of your loan interest rate and as your personal circumstances change over time, we find your loan requirements will also change, so we are available to chat again in the future to discuss any new lending requirements you may have. We find that our happy clients will return and as we already have a relationship with you, we can act faster to provide updated advice and information to you. We provide an ongoing relationship with you, not just a transaction. We do not normally charge for our services as the lender will pay us if the loan settles. This is not a fee added in your loan contract but all commissions we receive are disclosed to you regardless of where they are paid.
9. Protecting what's important
An often-overlooked aspect of the home buying process is to look at your own personal safety net, or risk insurance. What happens if something goes wrong down the track with health issues of either the income earners, or the child carer, life can be turned upside down very quickly. We do not directly provide risk insurance advice, but we do know from direct experience of what can happen when you or your partner has a health issue affecting capacity to work or care for dependants. We strongly recommend having a look at your personal risk insurance levels, which can be reviewed and (increased) or adjusted to suit your new debt commitment, to protect your equity in case of illness, sickness or injury. We have worked with professionals who can provide this advice (initial consultation is complimentary) for many years and will be able to help get this advice with a non-pushy qualified Financial Professional. This is a service additional to our main business, but we feel very important to not overlook in this process.
