Pre-Approval

In a fast-moving property market, having a home loan pre-approval (sometimes called conditional approval) is your superpower. It tells sellers you’re a serious buyer, helps you set a clear budget, and gives you the confidence to start your search.

But before a lender can give you the green light, they need to see exactly who you are and how you manage your money. Getting your paperwork together beforehand can save you weeks of stress.

At Outlook Finance, we walk our clients through this process step-by-step. Here is exactly what is required to secure your home loan pre-approval.

Step 1: Prove Your Identity (The 100-Point Check)

Lenders are legally required to verify exactly who you are. Before we can submit your application, you’ll need to provide clear, current copies of your primary identification:

• Australian Passport (or international passport with a valid visa)
• Driver’s Licence (front and back)
• Medicare Card
• Other options: A birth certificate or proof of age card if needed.

Tip: Make sure all of your IDs are in date, fully legible, and that your name matches exactly across all documents.

Step 2: If You Are Employed (PAYG) – Show Your Income

If you work a regular job with standard payslips, lenders need to verify your employment and salary. You’ll usually need to provide:

• Your 2 or 3 Most Recent Payslips: These should show your year-to-date (YTD) earnings, your employer’s name, and ABN.
• Most Recent Income Statement (formerly Group Certificate): Accessed via myGov or your employer.
• Bank Statements (usually 3 months): Showing your regular salary deposits matching your payslips.
• Most Recent ATO Notice of Assessment (NOA): Showing your taxed income for the year.

Step 3: If You Are Self-Employed – Two Paths to Approval

When you run your own business, are a sole trader, or work as a contractor, proving your income is slightly different. Depending on how your financials and tax returns are currently set up, we can utilize one of two pathways to secure your pre-approval:

Option A: Traditional Full-Doc (If your tax returns are up-to-date)

• 2 Years of Personal Tax Returns.
• 2 Years of Business/Company Tax Returns.
• 2 Years of Financial Statements (including Profit & Loss and Balance Sheets).
• 2 Years of ATO Notices of Assessment (NOA).
• Business Bank Statements (last 6 months): To show current cash flow.

Option B: Low Doc & Alt-Doc (If you don’t have up-to-date tax returns)

If you are still waiting on your latest tax returns, have Fluctuating income, or use tax-minimization strategies that don’t show your true borrowing power on paper, Option A can be difficult.

In this case, we specialize in Low Doc & Alt-Doc pre-approvals, which do not require traditional tax returns. Instead, you can prove your income using:

• Business Activity Statements (BAS): Usually the last 6 to 12 months of BAS lodged with the ATO, which show your business’s active turnover and cash flow.
• Business Bank Statements: 3 to 6 months of statements showing consistent deposits and transactions that demonstrate actual earnings.
• Accountant’s Letter (Declaration): A certified, signed declaration from a qualified accountant confirming your estimated income and the financial viability of your business.
• Active ABN and GST Registration: Proving your business has been operating successfully (usually for at least 12 to 24 months).

Step 4: Prove Your Financial Health (Expenses, Assets & Debts)

Lenders don’t just care about how much you earn—they also look at how you spend. To understand your financial capacity, you’ll need to declare:

• Living Expenses: Be prepared to provide an estimate and bank statements that verify your general spending (like groceries, insurance, utilities, and schooling).
• Proof of Savings & Deposit: Banks want to see where your deposit is coming from. You’ll need to provide at least 3 to 6 months of savings account statements showing “genuine savings” (or proof of a gifted deposit, if applicable).
• Active Debts: Statements for any credit cards, personal loans, car loans, or Buy Now Pay Later (BNPL) accounts (like Afterpay or Zip).
• Superannuation Statement: Your most recent statement showing your super balance.

Why Get Your Pre-Approval with Outlook Finance?

Every lender assesses income, living expenses, and self-employed files differently. Applying directly to one bank can risk a decline, which can negatively impact your credit score if multiple applications are made.

At Outlook Finance, we work with you to understand your specific financial situation before we apply. We will help you:

• Pre-qualify and make sure you have every correct document.
• Connect you with the lenders most likely to look favorably at your circumstances—whether you are traditional, self-employed, or need specialized low doc policies.
• Structure your pre-approval to provide optimal borrowing power, with loan capabilities up to $30 million (for major investments and developments).

Let’s Get You Match-Ready

Ready to buy? Let us help you organize your checklist and get your pre-approval sorted so you’re ready to make your move.

Book a free pre-approval consult with our Bankstown team today.

📍 Visit Us: Level 2, 300 Chapel Rd, Bankstown NSW 2200

📞 Call Us: 1300 432 961

Outlook Finance | Australian Credit Licence 418711 | ABN 73 132 561 874

Disclaimer: The information provided in this article is general in nature and does not constitute personal financial, investment, or credit advice. For specific advice tailored to your situation, please contact our team.

General Pre-Approval FAQs

What is a home loan pre-approval?

A home loan pre-approval (sometimes called “conditional approval”) is an assessment from a lender indicating how much they are willing to lend you, subject to certain conditions (such as finding a suitable property and final paperwork validation) . It is typically valid for 3 to 6 months (90 to 180 days) and can be renewed if needed.

Why is pre-approval so important?

• Confidence: You know exactly what your purchasing budget is.
• Leverage: Real estate agents and sellers will take your offers more seriously.
• Speed: It dramatically shortens the time it takes to get final approval once you find a property you love.

Does applying for pre-approval affect my credit score?

Yes, but typically only if you make multiple applications within a short period of time. When a lender assesses your pre-approval, they will do a “hard enquiry” on your credit file (1.1.1). Applying for multiple pre-approvals at once can make you look like a higher-risk borrower and lower your credit score.

At Outlook Finance, we run a pre-qualification assessment beforehand to ensure we only apply to the right lender, minimizing the impact on your credit history.

Paperwork & Requirement FAQs

What documents are required for the “100-point ID check”?

To prove your identity, you must provide clear copies of identification to make up 100 “points”. Usually, this includes:

• Primary Documents: A passport (70 points) and/or Birth Certificate (70 points).
• Secondary Documents: A Driver’s Licence (40 points), Medicare Card (25 points), or utility bill/bank statement with your current address (25 points).

What do PAYG (employed) buyers need to provide?

If you are a salaried employee, you will need to prove your income using:

• Your 2 or 3 most recent payslips (showing your employer’s name, ABN, and year-to-date earnings).
• Your most recent income statement (from myGov).
• Bank statements from the last 3 months showing your salary deposits.
• Your most recent ATO Notice of Assessment (NOA).

What will lenders check regarding my expenses?

Lenders have a legal obligation to ensure you can afford the loan repayments. They will ask for detailed estimates of your daily and monthly living expenses (e.g., groceries, entertainment, utility bills, school fees) and check these against your bank statements to assess your saving habits and spending patterns.

Do I have to declare BNPL accounts like Afterpay?

Yes. Lenders look at any active lines of credit, including “Buy Now Pay Later” (BNPL) services, credit cards, car loans, and personal loans. Even if you do not owe any money on a credit card, its limit counts as an active debt, which can reduce your overall borrowing capacity.

Self-Employed & Low Doc FAQs

Can I get pre-approved if I don’t have up-to-date tax returns?

Yes, you can. If you do not have up-to-date personal and business tax returns, you can apply for a Low Doc (Low Documentation) or Alt-Doc (Alternative Documentation) home loan .

Rather than standard financial statements, you can use:

• Business Activity Statements (BAS): The last 6 to 12 months lodged with the ATO to prove your turnover.
• Bank Statements: Show regular personal or business deposits over 3 to 6 months.
• An Accountant’s Letter: A formal declaration from a qualified accountant verifying your earnings and the stability of your business.

How long does my business need to have been operating for a Low Doc pre-approval?

In most cases, lenders require your ABN and/or GST registration to be active and operating for at least 12 to 24 months to consider your application. However, some specialized lenders may look at shorter periods on a case-by-case basis.

What deposit size do I need for a self-employed Low Doc loan?

For self-employed borrowers applying via Alt-Doc or Low Doc pathways, lenders generally expect a 20% deposit (LVR of 80% or less). While some specialized lenders can approve loans with smaller deposits, 20% will help you access the most competitive interest rates and avoid Lenders Mortgage Insurance (LMI).

For larger transactions, development, or construction projects, different capital structures can apply, which we can assist you with—including loan facilities up to $30 million.

Do you want to check your eligibility or start your paperwork?

The team at Outlook Finance is here to make your pre-approval process as stress-free and efficient as possible.

Let’s chat today to map out your borrowing capability and organize your checklist. Reach out to our Bankstown office on 1300 432 961 (1.1.4).

📍 Visit Us: Level 2, 300 Chapel Rd, Bankstown NSW 2200 (1.1.6)

Outlook Finance | Australian Credit Licence 418711 | ABN 73 132 561 874