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What does conditional approval mean?

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‘Conditional approval’ – it’s something you’re likely to see shortly after your home loan application has been lodged by your trusted Ocean Edge mortgage broker, but what does conditional approval mean?

It feels like you should be excited, but something tells you not to crack the champagne just yet. So what does conditional approval actually mean?

The good news is the bank has completed their initial assessment of your application. And, for the most part, they’re feeling a sense of confidence in entrusting you with a large sum of their money.

What are some of the conditions the bank might ask for?

The lender might require a few conditions to be completed to assess your application fully, which is why your home loan application has been granted conditional approval. The conditions may include:

  • A valuation – In Western Australia, as with all states, the bank will need to value the property you are using as security for the loan;
  • Updated documentation – such as newer payslips or updated proof of your savings;
  • New documentation not supplied to satisfy the lenders policy;
  • An action to take place – such as reducing the limit on a credit card;
  • An event to occur – such as ending a probation period with a new employer.

Conditions imposed by the banks are wide and varied and are highly dependent on the situation. Conditional approval when refinancing your home loan can be different to the conditions the bank asks for when you are purchasing a property and different again for a construction loan.

Is conditional approval a good thing?

It is important our clients are aware they should always see their loan moving to the conditional approval stage as being very positive, even if providing additional information can be onerous at times. Your loan application is moving in the right direction!

Your Ocean Edge Finance broker will guide you through the required items to satisfy the conditions and be very clear on what the lender requires. And we will go in to bat for you against the lender if we believe their requests are unreasonable.

Our goal is the same as yours, to get your loan approved. We will then work with the lender to move your loan application from conditional approval to the next stage – the ‘unconditional’ or ‘formal approval’ stage. Then you really can pop the champa’s!

Your home loan is one of the biggest financial commitments you will ever have. Our goal at Ocean Edge Finance is to demystify the finance process through constantly educating our clients on the ever changing home loan market and make sure that you’re staying a step ahead of the bank.

If you want to keep up to date you can sign up to our monthly newsletter to get all of our updates at the end of the month.

To find out more about how Ocean Edge Finance can help, feel free to call us on (08) 9319 2850, or drop into our office at Unit 2 / 8 Silas Street, East Fremantle. For further information see

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