Almost all banks require payslips in order to assess a home loan application. Without this essential information about your income, it presents a much higher risk to the lender. This usually means that you'll have to pay a higher interest rate or be declined outright but not every lender is the same!
This will involve a valuation of the property by the lender, sorting insurance for the property and finalising the contract of sale. The lender will also need to verify that your circumstances have not changed before granting the final approval.
Getting pre-approved for a loan only means that you meet the lender's basic requirements at a specific moment in time. Circumstances can change, and it is possible to be denied for a mortgage after pre-approval.
About your income
1 prior payslip including 3 months year to date.
Even though you might be earning the same money (or MORE) some banks will decline your loan after your pre-approval if you have recently switched jobs. This is because (some) banks want to see you in your role for at least 6 months, and don't like it if you have a history of lots of jobs over the short term.
Buyers are denied after pre-approval because they increase their debt levels beyond the lender's debt-to-income ratio parameters. The debt-to-income ratio is a percentage of your income that goes towards debt. When you take on new debt without an increase in your income, you increase your debt-to-income ratio.
Banks have many ways of verifying the information you provide on your home loan application. Banks will need documents to proof of your income, including recent payslips or Pay As You Go statements.
Deposit and Savings
Lenders generally will ask for bank statements showing your savings from the last three months. It could also be another method lenders use to review your expenses.
The preapproval is based on your financial profile, including your income, how much money you have in the bank and investment accounts and your debts. The lender performs a hard credit inquiry as part of the preapproval process, as well.
The short answer to your question is that a mortgage pre-approval can be cancelled if your personal or financial circumstances change. Your pre-approval is conditional and based on the information you provide the lender. If that information changes, your pre-approval is subject to cancellation.
A prequalification or preapproval letter is a document from a lender stating that the lender is tentatively willing to lend to you, up to a certain loan amount. This document is based on certain assumptions and it is not a guaranteed loan offer.
Home loan pre-approval (or conditional approval) means that a lender has agreed, in principle, to lend you money towards the purchase of your home but hasn't proceeded to full or final approval. Getting pre-approved for your home loan allows you to look – and enquire – with confidence.
It puts you on the fast track to closing.
Because most of your information is in the lender's system, a mortgage pre-approval accelerates the loan process once you make an offer.
Usually, most lenders are satisfied with two recent, consecutive payslips, showing the amount of money you're paid and your year-to-date (YTD) income. This helps them calculate whether you've been earning consistently throughout the financial year.
Mortgage preapproval is the process of determining how much money you can borrow to buy a home. Lenders such as Rocket Mortgage® look at your income, assets and credit score and determine what loans you could be approved for, how much you can borrow and what your interest rate might be.
Financial institutions check to see if a past account was “closed for cause,” meaning the bank or credit union shut down the checking account because of something you did. If the report shows you have a record of mismanaging other bank accounts, the institution could refuse to open a new account.
Payslips
Your two most recent payslips clearly showing employer details and net income.
It could be that you have the hard copy payslip from your last month's pay but your most recent payslip hasn't been sent to you yet so you print it off the HR portal. As long as the payslip details match up, it shouldn't be an issue with most banks.
Employee records are private and confidential. Generally, no one can access them other than the employee, their employer, and relevant payroll staff.
This occurs when a lender is considering extending a line of credit to you. Hard inquiries show up on your credit report and can affect your credit scores. For example, if you apply for a pre-approval offer, it will trigger a hard inquiry, and you could see a dip in your credit scores.
Inquiries for pre-approved offers do not affect your credit score unless you follow through and apply for the credit. If you read the fine print on the offer, you'll find it's not really "pre-approved." Anyone who receives an offer still must fill out an application before being granted credit.
The pre-approval typically requires a hard credit inquiry, which decreases a buyer's credit score by five points or less.
When a credit card offer mentions that someone is pre-qualified or pre-approved, it typically means they've met the initial criteria required to become a cardholder. But they still need to apply and get approved. Think of these offers as invitations to start the actual application process.