Formal Approval Validity

Discussion in 'Loans & Mortgage Brokers' started by Emboon, 21st May, 2019.

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  1. Emboon

    Emboon Well-Known Member

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    Let's assume we sign a contract of sale for a newly built home, valuation came back positive, etc.

    If we get a formal approval, how long is it valid for?

    Assuming it has a 90 day settlement period, will the bank need to do another valuation closer to the settlement date?
     
  2. Shahin_Afarin

    Shahin_Afarin Residential and Commercial Broker Business Member

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    It will be dependent on the lender - it can range from 2 months to 12 months.

    Some lenders have a policy whereby a new valuation is required even after formal approval if the previous valuation is now older than 3 months.

    Who is the lender?
     
  3. Emboon

    Emboon Well-Known Member

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    Macquarie Bank. If settlement is 90 days then it wouldn't be older than 3 months by the time it is settled.
     
  4. Shahin_Afarin

    Shahin_Afarin Residential and Commercial Broker Business Member

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    90 days is fine but they are one of the lenders that have the 3 month rule for valuations unless its signed off by credit.
     
  5. Jamie Moore

    Jamie Moore MORTGAGE BROKER - AUSTRALIA WIDE Business Member

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    If possible - it might not be a bad idea to try and settle a bit sooner just in case there are delays which tip you over the three month period.

    Cheers

    Jamie
     
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  6. Emboon

    Emboon Well-Known Member

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    That's a good idea. Care to share what are the possible cause of delays that can happen?
    Very new to this and all information will be of huge help.
     
  7. Emboon

    Emboon Well-Known Member

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    What does signed off by credit mean? After 3months, credit can sign off to forego another valuation?
     
  8. Shahin_Afarin

    Shahin_Afarin Residential and Commercial Broker Business Member

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    If the valuation goes over 3 months since it was completed then credit can waive the need for another valuation.
     

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