Finance approval and valuation

I've put in an offer on a house and im waiting for finance to get formally approved.

I'm concerned about the processing time and also the valuation. Major bank.
The area I'm buying in has had some large price rises recently so similar sales in the area don't really Compare. Plus the place needs a full renovation. Balcony is rotten and needs replacing etc. It's in a bit of a state. Do these sorts of factors affect the valuation? Is this a valid concern do you think?
And is it normal for the bank to be taking more than 20 days to give unconditional approval during this time?

 

these things can affect valuations but it will depend on the circumstances.

Some of the major banks are taking a lot longer than 20 days to give unconditional approval.

 

Thanks Terry.
What sort of circumstances?
20 business days?

The offer went in on the 18th of Dec and I've got until the 15th of Jan. 28 days in total. Do you think that's enough time? Or an I cutting it fine?

 

the type of valuation
and the repairs.

Which bank?

 

ANZ

Valuation it's a formal one where they go on site.

The house is in original state. So all kitchen and bathrooms need updating. Garden is overgrown. Basically it's not been maintained since the 70s. Roof probably needs replacing.

I paid a premium for it too.

 

the slowest lender out there atm.

 

I know we don't have a crystal ball. But do you think it's a major risk given my timeline?
What are some lenders that have a faster turn around if I go for a backup option?

 

prob best to ask your broker these questions. I would be concerned.
When was the valuation ordered and has it been done?

 

Not that it helps you now, but prior to making an offer, you should have been talking to your broker about how long loan apps are taking to get approved. Then put in conditions based on that.

 

I'm not sure when it was ordered but it hasn't been done yet to my knowledge.

 

So in general is 28 days at the moment not enough. Regardless of the lender? What sort of period should buyers be giving themselves to get unconditional approval?

 

14 days is generally enough. Not with ANZ though. I generally say to clients aim for 21 days, and accept 14 if you have to.

 

14 - 21 days should be fine with most lenders apart from a couple, ANZ being one of them. Over the xmas/new year period I advise a longer approval timeframe due to the two weeks where not much happens on the lender side.

Why ANZ?

 

I was already banking with ANZ.

Which other lenders are slow too that I should stay away from? I've got 10 days left to maybe find another one. Not currently with a broker.

 

You don't realise it, but you've done this in the wrong order, ignored what's important and stressed what is not important.

Before looking, talk to the mortgage broker first. They will suggest a lender based on your loan requirements, and tell you what is required including processing time to help structure your offer. No broker has ever asked me who I bank with. Because it doesn't matter. Give them all your documents at this point. Don't go look at property until the broker is happy they have all the documents they asked for, and tell you they are confident they can get you $x with lender Y, and some backup lenders if it doesn't work.

Then go look. Structure your offer according to the broker's suggestions around loans. Talk to them again before exchanging contracts.

Follow up every step of the way. A good broker will follow up for you, but nothing beats you doing it yourself. Know every date where a condition expires or something has to be done, and follow up with the mortgage broker, solicitor, etc.

Everyone wants to go look at property and make offers. That's only 20% of the work.

 

you would probably be best off to get the valuation done before applying for the loan.

 

Ah a classic mistake,
Plenty of lender options, engage a broker ASAP is my recomendation to you, there's still time!

 

Thanks Terry. Given the fact that it's in a pretty bad state do you think that the valuation is a risk?

 

Hard to say. It could be factored into the price and doesn't make the property uninhabitable so may not be an issue.

I would find out if the valuation has been done or not. They probably haven't even ordered it if you are dealing with the bank, they might assess it first and then order it if they preapprove the loan. causing further delays.