Beat the banks: Insider tips to get the best loan deals

OPINION

The tide is turning. After years of rising interest rates, things are finally starting to shift, and competition between lenders is heating up. That’s good news if you’re looking to buy, invest, or refinance.

But here’s the truth – not everyone gets access to the best deals.

At Loan Market, we’ve helped thousands of Australians secure finance, and we’ve seen it all from those who sail through approvals to others who, despite being financially solid, come to us after being knocked back.

The difference between them often isn’t always income or credit score, it’s preparation.

The best-prepared borrowers, the ones who do the work behind the scenes, tend to come out on top.

Here are some ways you can increase your chances of being approved for your home loan.

Show you’re a saver

Banks want to see that you’re disciplined. Regular, consistent savings – not a one-off gift from a family member – that shows that you can live within your means. It’s especially important for first home buyers who don’t have a history of paying off a mortgage. A 20 per cent deposit is generally

preferable as it avoids lenders’ mortgage insurance and can unlock better rates, but if you’re not there yet, don’t stress. What matters more is proving you’ve built the right habits.

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What you didn’t know about credit

A lot of people think credit is just a score, but it tells a story. That unused credit card you’ve had for years? It still counts against you. Even if you owe nothing, lenders assess your credit limit as a liability. A $10,000 limit could reduce your borrowing power by about $30,000 and, if you’ve got

multiple cards or a higher limit, that impact snowballs fast. If you have made multiple loan applications, you will have a mark on your file. Too many in a short time can signal an issue to the lender, even if they were all above board. That’s where brokers come in as they can check your

position and match you to the right lender without racking up unnecessary inquiries.

The credit inquiry trap

Every time you apply for a home loan, personal loan, or even buy appliances on interest-free credit, it’s marked on your file. Whether you’re approved or not doesn’t matter. Too many hits and lenders start to worry there may be an issue. This is where using a mortgage broker really helps. We can

guide you to the right lender and help you apply once, avoiding multiple applications.

Get the right type of property

You might be the ideal borrower, but if the bank isn’t comfortable with the property, your loan could still get knocked back. Some lenders have caps on how much they’re willing to lend in certain postcodes or apartment buildings. Small units under 40 square metres or high-density

developments often trigger caution. Banks want properties that hold their value and are easy to sell if needed. If your dream home is a bit quirky or unique, expect more scrutiny and fewer lender options.

The best-prepared borrowers, the ones who do the work behind the scenes, often tend to come out on top.

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Loan-to-value ratio is critical

LVR, or loan-to-value ratio, is simply the percentage of the property’s value you’re borrowing. If it’s under 80 per cent, you’re more likely to avoid LMI and unlock better rates. Above that, the risk (and cost) to you and the lender increases. Government schemes or guarantor options can help bridge the gap,

and some applicants working in certain professions, such as healthcare, may avoid paying LMI with some lenders. But you still need strong financial habits and a good credit history to make it all work.

Lifestyle counts

This one surprises people. Lenders dig into your bank statements to get a real picture of how you live. Every lender looks at living expenses slightly differently, but dependants, ongoing costs, and discretionary spending all come under the microscope. Whatever your set up, what matters most is

being in control of your money, not controlled by it.

– By Loan Market CEO, David McQueen