Pre-approval, also called conditional approval, is a lender’s early look at your borrowing. It checks your income, expenses, debts, savings and credit history, then says how much it is prepared to lend, subject to conditions.
What pre-approval isn’t
It isn’t a final loan approval. The lender still needs to assess the property you choose, usually with a valuation, and re-check your finances before giving unconditional approval. It doesn’t oblige the lender to lend you that amount.
How long it lasts
Most pre-approvals last around three months, and some lenders state 90 days. If you are still looking after that, many lenders will renew it, usually with updated documents. If your situation has changed, they will reassess you.
Documents you will need
If you are a PAYG employee, lenders usually ask for:
- photo ID
- recent payslips and proof of other income, such as overtime, bonuses or rent
- bank statements showing savings and everyday spending
- statements for credit cards, personal and car loans, and buy now pay later
- details of your living expenses
If you are self-employed, expect to provide more:
- the last two years of personal tax returns and notices of assessment
- for a company or trust, business tax returns and financial statements
- sometimes recent BAS and how long you have held your ABN
Will it affect my credit score?
Applying usually involves a credit check, and the enquiry is recorded on your credit file whatever the outcome. A few enquiries spread over time aren’t usually a problem, but applying with several lenders at once can make you look like a higher risk. A broker can compare lenders first and apply with the one that suits.
Why it matters at Perth home opens
- you know your realistic price range before you fall for a place
- you can make a confident offer, and selling agents often ask whether your finance is pre-approved
- you are ready to move when the right home comes up
Even with pre-approval, most buyers still make their offer subject to finance. That condition gives you time to get unconditional approval on that specific property.
What can make an approval fall over
- A low valuation: the lender values the home below the price, so you need a bigger deposit.
- Changes in your situation: a new job, especially on probation, fewer hours, a new car loan, extra credit cards or buy now pay later.
- Changes in lender policy or rates while you are searching.
- The property itself, if it doesn’t meet the lender’s rules, such as some small units.
- Missing or inconsistent documents.
Avoid new debt, try not to change jobs, and talk to your broker before any big financial decision.
How a broker helps
Lenders treat things like overtime, self-employed income, small deposits and certain property types differently. A broker comparing 30+ lenders can match you to lenders likely to say yes, explain the trade-offs and handle the application. Brokers must act in your best interests, and must tell you what commission they may receive from the lender.
Common questions
Is pre-approval the same as a home loan approval?
No. Pre-approval is conditional. The lender still needs to assess the property and confirm your finances before giving unconditional approval.
How long does pre-approval last?
Usually around three months, and some lenders state 90 days. Many lenders will renew it if you are still looking, usually with updated documents.
Does pre-approval hurt my credit score?
An application is usually recorded as a credit enquiry. One or two aren’t normally a concern, but several in a short time can count against you.
Can I make an offer without pre-approval?
Yes. Pre-approval just gives you more confidence about your budget and can make your offer stronger. Most buyers still include a subject to finance condition either way.
General information only, written on 11 October 2026. It doesn't take your personal circumstances into account. Rates, grants, tax rules and concessions change, so speak with us before making a decision.
