Home loan pre-approvals explained:
the what, why, when and how
Last updated: 06 October 2025 | Estimated read time: 2 Minutes
Getting pre-approved for a home loan is a key step in your home-buying journey. It gives you a clear idea of how much you may be able to borrow and helps you make offers with confidence when you find the right property.
Here’s what you need to know about how pre-approval works, when to apply, and how to get started.
Did you know?
Why do people apply for home loan pre-approvals?
Pre-approval gives you a borrowing estimate based on your current financial situation. It’s not a guarantee, but it can help you:
- Understand your budget before you start house hunting.
- Show sellers and agents that you’re a serious buyer.
- Bid with confidence, especially at auctions, where knowing your upper limit is essential.
When’s the right time to apply?
Most people apply for pre-approval when they’re ready to start looking at buying a property. But before you do, keep these tips in mind:
- Avoid multiple applications: Applying with several lenders in a short time can impact your credit score. It’s best to choose your preferred lender first.
- Know the expiry: Pre-approvals typically last 3 to 6 months, but can often be extended if your situation hasn’t changed.
- Keep your lender updated: If your circumstances change, like a new job, a baby, or a new loan, then your lender may need to reassess your application.
How long does pre-approval take?
While the full home loan process can take up to six weeks, pre-approval can be much quicker. Applying with Pepper Money, it can take as little as 2 business days if you’ve submitted all the required documents.
You’ll typically need:
- Recent bank statements
- Payslips or proof of income
- Personal ID
- A summary of your assets and liabilities (such as savings and other loans).
We’re here to help
To get a home loan pre-approval with us, contact one of our Lending experts on 137 377 or request a call back by filling in our online form. They will guide you through the process, explain your options, and answer any questions. Alternatively, speak with your Pepper Money accredited broker.
It’s helpful to have the following ready:
- The price range of properties you’re considering
- Your available deposit
- Details of your income and living expenses
Want a quick estimate? Try our borrowing power calculator to see how much you could borrow.
Contributor | Barry Saoud, General Manager, Mortgages and Commercial Lending
Barry joined Pepper Money in July 2021 as General Manager, Mortgages and Commercial Lending. He is responsible for the strategic direction and operating performance across product, credit, and settlements for mortgages, commercial loans, personal loans, and direct sales. Read more.
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Need some help with your first home loan?
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Information provided is factual information only and is not intended to imply any recommendation about any financial product(s) or constitute tax advice. If you require financial or tax advice you should consult a licensed financial or tax adviser.
All applications for credit are subject to credit assessment, eligibility criteria and lending limits. Terms, conditions, fees and charges apply.
The results of the borrowing power calculator are based on information you have provided and is to be used as a guide only. The output of the calculator is subject to the assumptions provided in the calculator (see 'about this calculator') and are subject to change. It does not constitute a quote, pre-qualification, approval for credit or an offer for credit and you should not enter commitments based on it. The interest rates do not reflect true interest rates and the formula used for the purpose of calculating estimated borrowing power is based on the assumption that interest rates remain constant for the chosen loan term. Your borrowing power amount will be different if a full application is submitted and we complete responsible lending assessment. The results in the calculator do not take into account loan setup or establishment fees nor government, statutory or lenders fees, which may be applicable from time to time. Calculator by Widgetworks.
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