Home loan pre-approval | Conditional approval - NAB

Did you know

What is conditional pre-approval?

It means a lender has agreed in principle to lend you up to a certain amount, based on the information you’ve provided. You’ll understand what you may be able to borrow before you make an offer on a property.

Conditional pre-approval isn’t the same as a final approval. It’s usually subject to further checks, including a review of the property you want to buy and whether your financial situation has changed.

What it means for you

Conditional pre-approval can help you better understand your borrowing position, but it’s not a final home loan approval. Here’s what it covers and what still needs to be confirmed.

What conditional pre-approval can help you do

It can help you:

  • understand your estimated borrowing amount.
  • search for homes that may be within your borrowing range.
  • compare suburbs, property types or price ranges with a clearer budget.
  • feel more prepared when making an offer.
  • show sellers and agents you’ve started the finance process.
  • understand your starting point before moving further into the buying journey.

What conditional pre-approval doesn’t cover

It doesn’t mean:

  • your home loan is fully approved.
  • the property you’ve choose has been accepted by the lender.
  • your interest rate is locked in.
  • your repayments won’t change.
  • your borrowing amount won’t change if your circumstances change.
  • the lender has completed a final property valuation.

Conditional pre-approval is usually subject to conditions

These conditions can vary depending on your financial situation, the property and the lender’s assessment. Generally, it’s subject to:

  • your financial situation staying the same.
  • your income, expenses, assets and debts being verified.
  • your credit history being assessed.
  • the property being acceptable to the lender.
  • the property valuation supporting the loan amount.
  • any required documents being provided.
  • the pre-approval still being valid when you find a property.

When to apply

It can help to apply when you’re close to actively looking for a property or making offers. If you apply too early, your conditional pre-approval may expire before you find a home and you may need to reapply, which can affect your credit score. NAB’s conditional approval certificate is valid for 90 days if conditional pre-approval is granted. 

Multiple applications within a short period can lower your credit score and make you look like a riskier borrower to lenders, which may impact your ability to secure favourable loan terms when you’re ready to buy.

Before applying, it can also help to have a general idea of:

  • how much deposit you have saved.
  • what you may be able to afford in repayments.
  • the suburbs or areas you’re interested in.
  • the type of property you’re looking for.
  • the home loan features that may matter to you.

How to get conditional pre-approval

Work out what you may be able to afford

Before applying, you can use home loan calculators to estimate your borrowing power and possible repayments. This can help you understand your price range before speaking to a lender.

Review your home loan options

You may want to compare different home loan options and features before you apply. This can include things like fixed or variable interest rates, offset accounts, redraw facilities and repayment options.

Gather your documents

Your lender will usually ask for documents that help show your financial situation. This may include proof of income, bank statements, details of your expenses, existing debts and savings.

Apply for conditional pre-approval

Once you apply, your lender will review your financial situation. They may look at your income, expenses, debts, assets and employment situation (for example, self-employed, full-time, part-time, etc.). A credit check may also be completed as part of the assessment.

Receive your conditional pre-approval decision

Once granted, you’ll receive details of the amount the lender may be willing to lend you, along with any conditions and the expiry date. NAB emails a conditional approval certificate if pre-approval is granted.

Start searching within your estimated budget

You can use your estimated borrowing amount as a guide when searching for a property, helping you focus on homes that may be within your budget.

How long does a conditional pre-approval take?

In some cases, it may take a few hours. In other cases, it may take a few days or weeks.

Timing can depend on things like:

  • how quickly you provide the documents requested.
  • whether your income or employment situation is straightforward.
  • whether there are issues in your credit history.
  • whether you have multiple debts, income sources or other financial commitments.
  • how long it takes the lender to assess your application.

Providing complete and accurate information can help avoid delays.

How to keep your conditional pre-approval on track

  • Keep track of your pre-approval expiry date.
  • Respond if your lender asks for more information.
  • Let your lender know if your income, expenses or employment changes.
  • Avoid making assumptions about your final borrowing amount.
  • Check whether your conditional approval still suits your situation before making an offer.

This doesn’t guarantee final approval, but it can help you understand where your application stands as you move through the home buying process.

What happens after conditional pre-approval?

You may continue searching for a property, make an offer or bid at auction.

You’ll likely feel more prepared when making an offer. If the seller and sale conditions allow, you may be able to make your offer subject to conditions, such as finance approval or building and pest inspections. A solicitor or conveyancer can explain how contract conditions work and what they may mean for your situation.

If you’re bidding at auction, it’s important to understand how the auction process works before you bid. If your bid is successful, you’ll still need to go through the final approval process.

Before giving final approval, your lender will need to complete more checks, including valuing the property and confirming that all loan requirements have been met.

The journey after a pre-approval may include,

  • finding a property within your estimated budget.

  • making an offer or bidding at auction.

  • telling your lender when you’ve found a property.

  • providing any extra documents requested.

  • having the property valued by the lender.

  • moving from conditional approval to final approval, if all requirements are met.

  • signing loan documents and preparing for settlement.

How to start your journey with us

Where you start may depend on how far along you are in your property search. You can estimate your borrowing power, learn what documents you may need, or speak to a home loan expert about applying.

If you’re working out your budget

Use our borrowing power calculator to estimate how much you may be able to borrow before you start looking at properties.

Check your borrowing power

If you’re getting ready to apply

Learn what information and documents you may need when applying for a home loan.

See what documents you may need

If you’re ready to discuss conditional pre-approval

A home loan expert can talk you through the process and explain what may apply to your situation.

Talk to an expert

Ready to purchase your home?

Talk to our home loan experts today.

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Contact us for home loan related queries

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Important information

The information contained in this article is intended to be of a general nature only. It has been prepared without taking into account any person’s objectives, financial situation or needs. Before acting on this information, NAB recommends that you consider whether it is appropriate for your circumstances. NAB recommends that you seek independent legal, financial and taxation advice before acting on any information in this article.