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Pre-approval is a preliminary review conducted by a bank or financial institution based on the buyer's financial situation before the buyer formally applies for a mortgage. The review will assess the maximum loan amount, interest rate and repayment terms that can be approved. This service allows buyers to clearly understand their housing purchase budget and be more targeted when looking for a house, thereby increasing the success rate of the transaction.
Benefits of Mortgage Pre-Approval
Lock in your rate and terms
Some banks will provide an "interest rate holding period" during pre-approval to prevent market interest rate fluctuations from affecting the final loan terms.
Clarify your home purchase budget
Based on the approved amount, buyers can screen properties that fit their budget and avoid transaction failure due to insufficient loan.
Improve bargaining power
Sellers or developers tend to accept pre-approved buyers because their financial capabilities have been confirmed and the transaction risk is lower.
Speed up the formal application process
After pre-approval, you only need to provide the latest documents (such as property information) when applying formally, which will speed up the approval process.
Reduce financial risk
Avoid the risk of signing a provisional sales contract and then finding out that your loan is rejected and you have to pay the deposit or face the risk of default.
People with unstable income
Those with irregular income, incomplete income proof, or a history of debt.
Special Property Buyers
Units that are too old, have complex ownership (such as heritage properties), or have unauthorized structures or structural problems.
How to apply
- Select a financial institution
Compare mortgage rates, offers and terms from different banks and choose the most suitable institution. - Submit application and documents
Submit the pre-approval application form and required documents (see checklist below) online, at a branch or through an agent. - Waiting for review
It usually takes 3-7 business days, and the bank will evaluate income, liabilities, credit rating, etc. - Get the results
After successful approval, the bank will provide a written or electronic notification stating the loan amount and conditions.
Required Documents
Generally, the following basic documents are required (they may vary slightly depending on the institution's requirements):
Proof of identity
- Copy of ID card/passport
Proof of income
- Last 3-6 months pay slips
- Tax bill (if applicable)
- Letter from employer (specify position, monthly salary and term of office)
- Self-employed persons: company financial statements, profit tax returns
- Employer certificate or employment business card
Proof of assets
- Bank statements from the last 3-6 months (showing deposits and income and expenditure records)
- Proof of other assets (stocks, funds, properties, etc.)
Current debt information
- Credit card balances and other loan repayment records
Property Information (if selected)
- Provisional sales and purchase agreement (if signed)
Approval Result
- Successful approval: The bank will provide a "pre-approval letter" stating the loan amount, interest rate, repayment period and additional conditions (such as the property needs to pass a formal valuation).
- Conditional approval: You may need to submit additional documents (such as updated proof of income).
- Approval rejection: You can ask the bank for the reason (such as insufficient income, low credit score) and reapply after improving the situation.
Pre-approval validity period
- Generally it is 3-6 months, and may vary from bank to bank.
- If the interest rate or financial situation changes during the validity period (such as unemployment, new debt), the bank may review it again.
- If the application is overdue, you need to resubmit it. It is recommended to complete the property transaction within the validity period.
Precautions
- Non-final commitment: Pre-approval does not mean formal approval, and the final loan still needs to pass property valuation and document review.
- Avoid multiple applications: Applying to multiple banks within a short period of time may affect your credit score.
- Market changes: If interest rates rise or policies tighten, formal approval conditions may be different from pre-approval.
FAQ
How long does it take to get a mortgage pre-approval?
Generally, pre-approval takes about 2 weeks
Banks review standard mortgage applications (such as 60% mortgages) and can usually complete preliminary approval within 2 weeks if all documents are complete and there is no complex financial background.
Key influencing factors
✅ Document completeness (such as proof of income, tax bills, property information)
✅ Applicant credit score
✅ The bank’s current approval caseload
High-ratio mortgage insurance (such as 80%-90% mortgage)
Extended to 3-4 weeks
The process is more complicated because it needs to be reviewed by banks and mortgage insurance companies (such as the Hong Kong Mortgage Insurance Company) at the same time.
Additional review focus
✅ Is the property valuation up to standard?
✅ Stress test of applicant’s repayment ability
✅ Premium calculation and insurance terms confirmation
Is there any way to speed up the approval process?
Prepare a list of documents in advance
Required Documents: Proof of identity, 3-6 months income proof (pay slip/bank statement), tax bill, letter from employer, temporary property agreement.
Self-employed/non-regular income earners: Two years of financial statements and MPF records are required.
Active follow-up and communication
Contact the bank 3-5 days after submission to confirm whether the documents are complete.
If mortgage insurance is involved, you can ask the bank whether additional information (such as a renovation quotation) is required.
Avoid common causes of delays
❌ The document is blurry or has missing pages
❌ The income certificate does not match the bank statement
❌ The property valuation is lower than expected (you can entrust the bank to conduct an assessment in advance)
Is there any fee for pre-approval?
It is usually free, but some institutions may charge a handling fee, which needs to be confirmed in advance.
Do I have to accept the mortgage from this bank after pre-approval?
No, buyers can still compare other banks' conditions, but they will need to resubmit their application.
What if the property price exceeds the pre-approved amount?
You need to make up the difference in the down payment, or reapply for a higher loan amount (subject to your financial ability).
Mortgage pre-approval is formalGrantMortgage?
Mortgage pre-approval is a "conditional approval" made by the bank based on the preliminary information provided by the applicant (such as income, credit history, etc.). It only means that the applicant meets the basic loan qualifications, butNot equivalent to the final result. Its effectiveness is similar to "prequalification" and is affected by subsequent actual circumstances.
Key moving factors
Income stability: If your income decreases (e.g. job change, commission reduction) or your liabilities increase when you formally apply, the bank may reduce the loan amount or reject your application.
Property Valuation and Condition：The bank will ultimately approve the application based on the "actual transaction price" or "valuation report". If the property price drops or there are illegal structures or structural problems with the property, it may trigger a review or even revoke the pre-approval.
Policy and interest rate changes: If market interest rates rise or banks tighten their mortgage policies, the terms of the pre-approval may become invalid.
Risk management advice
Lock in the pre-approval deadline: The pre-approval period of most banks is 3 months, and the transaction must be completed within this period.
Reserve buffer space: The housing purchase budget should be lower than the pre-approved amount of 10%-15% to avoid funding gaps due to insufficient valuation.
Thorough building inspection: Before signing the contract, entrust a professional to inspect the property to eliminate potential problems such as unauthorized construction and illegal reconstruction.
Keep your finances in check: Avoid taking out new loans (such as car loans, credit card installments) after pre-approval to maintain a stable source of income.
Differences in formal approval
Before lending, banks will conductReal estate substantive review(such as entrusting a surveyor to conduct the assessment) and requiring submission of the latest income proof (such as a recent pay slip). If it is found that the information is inconsistent with the pre-approval stage, additional documents may be required or the terms may be adjusted.
How can I provide the property address if I have not purchased the property at the time of pre-approval?
Apply with the address of the "target unit"
Even if you have not yet signed a provisional sales and purchase agreement, you can still select the specific address of the unit you are considering (such as a specific block and floor of a building) for pre-approval. The bank will preliminarily approve the loan amount and interest rate based on the valuation and property conditions of the address.
Flexibility to substitute similar properties
If the final property purchased is different from the pre-approved address, the bank will usually maintain the original terms as long as the following conditions are met:
The same housing estate or adjacent community (e.g. changing from Block A to Block B)
The unit area and floor are similar (the price difference is within 10%)
The property types are the same (e.g. both are second-hand residential properties, first-hand pre-sale properties, etc.)
Key details to note
Revaluation mechanism: Even if the terms remain unchanged, the bank will still conduct a formal valuation of the actual property purchased. If the valuation is lower than expected, the loan amount may be reduced accordingly.
Restrictions on the pre-sale period: If you are pre-approved for an existing building address and later change to buying a pre-sale property, you need to confirm whether the bank accepts the pre-sale property mortgage policy.
Supplementary documents: A formal sales contract must be submitted to replace the temporary address used during pre-approval when the transaction is completed.
Alternatives without a specific target
If you have no idea what unit you are looking for, you can provide:
Reference cases in the area: for example, "two-bedroom units in XX district for about 5 million" as an example
Collaborate with mortgage brokers: Professionals will help you select the simulated property addresses that meet your budget
Risk management advice
If you change to a higher-priced property after pre-approval (e.g., change from a 5 million to an 8 million unit), you will need to reapply for a mortgage.
Keep a 10-15% budget buffer to avoid affecting the down payment due to insufficient valuation
The validity period of the pre-approval result is usually 3 months, so it is safer to complete the purchase of the house within the time limit.
Practical operation examples:
Xiao Ming wants to buy a unit in Housing Estate A. He applies for pre-approval using the address "Room B, 10/F, Block 3, Housing Estate A" and is approved for a 70% mortgage and an interest rate of H+1.3%. Two weeks later, I changed my purchase to Room C, 8/F, Block 5 in the same housing estate (same area, transaction price 2% lower). The bank directly used the original terms and only required the submission of the formal contract and building inspection documents.
It is recommended to communicate in detail with the bank or professional mortgage advisor to develop a pre-approval strategy based on your personal financial situation so that you can respond more flexibly to market changes.
