8 ways to boost your chances of loan approval

Getting ready to apply for your first home loan? Run through this checklist first so that your credit profile will be ship shape and you'll have the best chance of getting approved.

Unless you’re fortunate enough to have just won Lotto, you’ll need to get a mortgage from a bank or home loan lender to help you buy your first home. 

Every bank tends to have its own lending criteria and for first time buyers it can be unsettling not knowing whether you’ll actually get approved. But there are a number of things you can do to shape up and improve your chances of getting your home loan application accepted, such as: 

1. Improving your credit history

Before applying for a home loan, get a free copy of your credit report from Veda, D&B or Experian. This will allow you to see what lenders see when they review your application. Once you have a copy of your report, check everything for errors and if you spot an issue, notify the company responsible immediately. Sometimes it can be something small like a wrong address or an old credit card account you no longer use but haven’t closed.

2. Having proof of genuine savings 

It’s likely that you’ve been putting cash away each week in order to save up your first home deposit but if you haven’t, and you were planning to rely on a gift, tax refund or grants like the First Home Owners Grant (FHOG), it is time to start saving. 

These days, most lenders have a mandatory genuine savings policy for anyone who applies for a home loan, especially if you are borrowing 90% of the property value or more. You’ll be required to show at least 3 months of genuine savings. Types of savings considered genuine savings are savings accounts, term deposits and mutual funds.

3. Holding off on career changes 

You may be thinking that a $100,000 salary will increase the amount you can borrow and you might be right - but if it means making a sudden career change, it may not be the best move when it comes to your mortgage application. 

When applying for a home loan your finances will come under a microscope and lenders will want to see that you’ve been in your job for a decent length of time, so save the career changes until after you’ve got your mortgage.

What's more, you’ll need to supply copies of around 3 - 6 months of your most recent payslips to the bank when you apply.

4. Reducing debts as much as possible 

In addition to saving for that deposit, you’ll also need to show the lender that you’re able to manage your money responsibly. If you have a car loan or credit card, make more than the minimum monthly repayments.

5. Staying up-to-date on all bills 

With the move to comprehensive credit reporting (CCR), lenders will know when and how often you make late payments. It's always best to set up a direct debit for utilities and credit card payments and when you can top up with an extra repayment during the month.

6. Keeping other applications to a minimum 

Every application for credit goes on your file (including mobile phones) so in the months before you apply for your home loan, hold off on getting a new phone, TV or any kind of store card until after your mortgage is secure.

7. Breaking with past relationships 

If you had joint accounts with an ex and never got around to getting your name removed from the account, now is the time. You don’t want their credit history affecting your application.

This also applies to businesses you may have dealt with in the past but haven’t bothered to close off the account. 

8. Living within your means 

Good money management skills are a must-have when owning your own property. You might be required to show copies of recent bank statements to prospective lenders to demonstrate that you can live easily within your budget.

Home Loan Comparison Table - last updated 13 August 2022

Search promoted home loans below or do a full Mozo database search . Advertiser disclosure
  • Variable Home Loan 70

    interest rate
    comparison rate
    Initial monthly repayment
    3.10% p.a. variable
    3.12% p.a.

    Affordable home loan rate for buyers or refinancers.. No monthly or ongoing fees. Option to add an offset for 0.10%. Access to savings with unlimited redraws available. Minimum 30% deposit required.

  • Unloan Variable

    Owner Occupier, Refinance Only

    interest rate
    comparison rate
    Initial monthly repayment
    3.14% p.a. variable
    3.06% p.a.

    For refinancers only. Built by CommBank, the Unloan is the first home loan with an increasing discount (conditions apply) for borrowers. No application or banking fees. No monthly account keeping or early exit fees. Apply in as little as 10 minutes.

  • PAYG Home Loan

    Owner Occupier, Principal & Interest, LVR<80%

    interest rate
    comparison rate
    Initial monthly repayment
    3.29% p.a. variable
    3.33% p.a.

    Low variable rate. Ideal for new home buyers or refinancers. Unlimited additional repayments. Unlimited free redraw. Application completely online. Optional 100% offset can be added for $120 p.a.. 20% deposit required.

  • Celebrate Variable Home Loan

    <60% LVR, Owner Occupier, Principal & Interest

    interest rate
    comparison rate
    Initial monthly repayment
    3.79% p.a. variable
    3.79% p.a.

    Fast and efficient online application. Automatic discounts as loan is paid down. Free extra repayments and redraw facility. Zero fees. Min 40% deposit required.


* WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for $150,000 over 25 years.

** Initial monthly repayment figures are estimates only, based on the advertised rate, loan amount and term entered. Rates, fees and charges and therefore the total cost of the loan may vary depending on your loan amount, loan term, and credit history. Actual repayments will depend on your individual circumstances and interest rate changes.

^See information about the Mozo Experts Choice Home Loan Awards

Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.

While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.