Last month, we brought you the story of our Sale Ezy team mate who started investigating her home loan, only to find the bank she had been loyal to for ten years no longer offered competitive interest rates. In fact, they hadn't been competitive for years.

What she realised, by visiting a mortgage broker, was by staying loyal to her bank and not refinancing, she had been losing almost $1000 each month! Who can afford that?

Financing a property purchase can be confusing, both at the start, and years down the track, when your home loan is well established and paying the monthly fee is all just part of the routine.

And before you even start looking for a property, you need to know and have some security that the bank will in fact lend you money to make a purchase.

Finance pre-approval for a property purchase is exactly as it sounds -- its consulting with a lending institution or a broker and submitting an application for an initial loan assessment.

If you're approved, it's for an amount, not a property and it's still not a sure thing -- the bank will need to approve the loan for the specific property you find and want to purchase.

Recently, another of our team decided to start the hunt for her first property -- surprise! Our team is obsessed with real estate -- but she wanted to be sure she'd be able to finance the purchase.

In this article she shares some of her key learning from the finance pre-approval process:

1. Give it time -- finance pre-approval can take longer than you think!

"We started our pre-approval process at much the same time as we started our property search process.

We thought the pre-approval process would be relatively quick and easy, and it was more likely we'd hear from the bank before we found a property we wanted. In honesty, we expected we'd have pre-approval inside of a week. We were wrong!

We decided to just get pre-approval with our current bank. We liked it, the rates were good and we didn't want the fuss of having different money everywhere.

We met with our manager, had a chat and we were walked through the paperwork -- which was much more extensive than expected!

After filling in and submitting the paperwork, we figured we could get down to the hunting, so we got out there, hit the open homes and started filling our Saturdays with appointments.

After only a couple of weeks, we found a property we were interested in... but with no word from the bank, and many, many follow up questions, we didn't feel secure enough to start the negotiation process.

To cut a long story short, my husband is self-employed, and despite our excellent financial record and the fact we'd been with our bank for years, we were actually not awarded financial pre-approval... something we only found out several weeks later.

What we learned is, regardless of the outcome, is these things can take time, so don't go into it thinking this is an immediate turnaround -- each situation is different, each institution is different, and getting pre-approval takes the time it takes!

2. Use a broker

"Now this message isn't for everyone, but it certainly worked for us. After the mishap we had with the bank, we basically thought that was it, we'd be renting forever, unless my husband decided to give up his growing business and head back into middle management.

But a friend recommended a broker to us -- just to see what they could do.

We met with the broker, and he was great. He explained to us that different institutions have different policies -- he told us this wasn't the end of the line for us and that self employment wasn't always prohibitive.

The broker went through everything with us and we were brutally honest about every single aspect of our situation.

Based on his own knowledge, he made some calls for an initial chat with different institutions. He received a 'no' from some, but surprisingly, a more positive response from others! We re-completed the mountain of paperwork and resubmitted with renewed hope!"

3. Be prepared to be open

"Did you know a lot of people are quite cagey when it comes to home loan applications? I never understood it until we filled in our first one. Really, it makes sense the bank needs this much information to determine if they will lend you hundreds-of-thousands of dollars, but never-the-less, it still feels really invasive.

Approach this process knowing your financial life -- and as such, everything you spend your money on -- is going to be laid out for someone else's prying eyes.

Just remember, while you may feel the need to explain that weekly line in your bank statement that covers off your Kmart addiction or weekend trips to Maccas or the bottlo, assessors have seen this all before and a) they don't actually know you b) they probably don't care!

Be honest, open and transparent, the process will be easier and faster."

4. The banking commission has changed things

"In talking to our broker, and also to many real estate agents as part of our house hunt and my job, it became abundantly clear things are different now when it comes to getting a loan, then they were a few years ago.

The establishment and findings of the Banking Royal Commission have had a big impact on the thoroughness of the loan process, the scrutiny of your financial life and details, and the likelihood of people getting loans."

5. It's not guaranteed, but it is necessary

"We learned from our first application, and the conversations our broker had with lenders, that, just because you believe you are financially healthy and worthy of a loan, does not mean banks and lenders will feel the same.

Filling out the truck-load of forms does not guarantee you will be pre-approved, and being pre-approved does not mean you will get the loan. In fact, we know of buyers who were pre-approved, but when they found a property, the bank wouldn't loan them enough to cover their offer due to their own independent valuation of the property's value.

Despite that, getting pre-approval is necessary. Firstly, it does give you more assurance that the bank knows you are 'good for it' and they may be willing to lend to you.

Secondly, it means part of the process is already complete if you need to quickly get approval so you can bid at an auction, where you need to be prepared to lay down money on sale day and complete the sale if your bid is successful."

Conclusion: "I've worked in and around real estate my whole life, but never been in a position to purchase until now.

Doing it yourself, you learn things you don't see when you are just assisting other people, or waiting for them to show up with finance.

Understanding the processes and the challenges of finance can be very helpful in informing and guiding your approach to house-hunting, your timelines and managing your own expectations."