As part of the home loan application process, brokers and lenders conduct an affordability assessment to determine whether you are eligible for a loan. You might be wondering 'How do I prepare for an affordability assessment?'
Gather all the necessary documents
Before the appointment, you should gather all the documentation your broker requires. These documents include:
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Last three months’ bank statements
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Proof of income (two latest payslips and PAYG summary)
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Two years worth of accounts and ATO assessments (if you’re self-employed)
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Existing mortgage/loan/credit card commitments
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Any details of credit issues
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Existing savings accounts, life insurance policies, pensions, healthcare policies
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A form of identification (passport/driving licence/birth certificate)
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Proof of address
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A copy of your credit report
Incomings and outgoings
When conducting affordability assessments, brokers and lenders go through your finances with a fine-toothed comb. Some of the things they look at include:
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Earnings
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Shopping habits
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Credit statements
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Subscriptions (e.g., TV, music, games)
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Bills
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Gambling
During these assessments, everything that goes in and out of your bank account will be analysed. So, another way to get prepared for yours is to jot down any extra income, your monthly household budget, and your personal expenses (gym memberships, clothes, holidays, streaming subscriptions, etc.) By preparing this information, you will be more organised and it can speed up the assessment process.
To find out more about the affordability process of securing a mortgage, talk to one of our expert brokers today.
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