Do lenders lodge the preapproval enquiry in credit file?

Discussion in 'Loans & Mortgage Brokers' started by PropertyInsight, 21st Sep, 2017.

Join Australia's most dynamic and respected property investment community
Tags:
  1. PropertyInsight

    PropertyInsight Well-Known Member

    Joined:
    22nd Jun, 2017
    Posts:
    332
    Location:
    Australia
    I am just wonder if lenders I.e. NAB lodge finance preapproval as an enquiry in credit file? If yes, how would it impact on credit file if there are 3-5 enquiries within 6 months?
     
    PropertyInsight, 21st Sep, 2017
    #1
  2. D.T.

    D.T. Specialist Property Manager Business Member

    Joined:
    3rd Jun, 2015
    Posts:
    9,190
    Location:
    Adelaide and Gold Coast
    Yes I'd say so.

    Impact would be based on the explanation put forth with the app.

    Or you could go the mortgage broker route, you won't need a pre approval
     
    D.T., 21st Sep, 2017
    #2
  3. Jess Peletier

    Jess Peletier Mortgage Broker & Finance Strategy, Aus Wide! Business Member

    Joined:
    18th Jun, 2015
    Posts:
    6,685
    Location:
    Perth WA + Buderim Qld
    5 enquires in 6 months isn't great, especially if you're at high LVR and using lenders that credit score.

    Pre-approvals definitely will hit your file.

    If you think that may be the case, go see a broker who can direct you to a lender who won't auto decline you. They can also give you an idea on servicing in a way that won't hit your file and will look at many lenders rather than just one.
     
    Jess Peletier, 21st Sep, 2017
    #3
  4. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

    Joined:
    14th Jun, 2015
    Posts:
    10,653
    Location:
    Gold Coast (Australia Wide)
    Typically every lender that has a proper pre approval that can be relied upon will hit your file. - every time.

    In most but not all cases it's part of an automated system.

    If your lvr is 80 and certainly 90 or above most scoring engines won't like that level of credit activity.

    As Jess said if this is a concern for you then choose a lender that doesnt auto score

    Ta

    Rolf
     
    Rolf Latham, 21st Sep, 2017
    #4
  5. Jamie Moore

    Jamie Moore MORTGAGE BROKER - AUSTRALIA WIDE Business Member

    Joined:
    18th Jun, 2015
    Posts:
    3,980
    Location:
    Canberra, Brisbane and Sunshine Coast
    Yes.

    It's not good. 5 hits in 6 months is not going to provide the assessor looking at your application with a lot of confidence (automated credit scoring systems won't like it either) - particularly if the loan requires LMI.

    Simple solution is to limit credit hits and apply once with the right lender.

    Cheers

    Jamie
     
    Jamie Moore, 21st Sep, 2017
    #5
  6. RPI

    RPI SDA Provider, Town Planner, Former Property Lawyer

    Joined:
    18th Jun, 2015
    Posts:
    2,025
    Location:
    Brisbane
    Another reason to use a broker.
     
    RPI, 21st Sep, 2017
    #6
    Colin Rice likes this.
  7. Colin Rice

    Colin Rice Mortgage Broker Business Member

    Joined:
    9th Jul, 2015
    Posts:
    3,184
    Location:
    Perth
    What was the purpose of the pre approval - auction?

    Cant see any other reason why you would need one from a bank outside of that!
     
    Colin Rice, 21st Sep, 2017
    #7
  8. Peter_Tersteeg

    Peter_Tersteeg Mortgage Broker Business Member

    Joined:
    18th Jun, 2015
    Posts:
    8,171
    Location:
    03 9877 3000
    Last edited: 22nd Sep, 2017
    Peter_Tersteeg, 21st Sep, 2017
    #8
    Corey Batt, RPI, albanga and 3 others like this.
  9. albanga

    albanga Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    2,701
    Location:
    Melbourne
    @Peter_Tersteeg awesome post!
    That is the best explanation I have read regarding pre-approvals on these forums.
     
    albanga, 22nd Sep, 2017
    #9
    PropertyInsight likes this.