What are the Steps in the Home Buying Process?

What Happens Between Pre-Approval and Settlement?

Pre-approval confirms how much you can borrow, then you search for a property, make an offer, sign a contract, and move through formal approval and settlement. Each stage has specific documents, timeframes, and decisions that directly affect when you receive the keys.

Consider a hospital pharmacist at a metropolitan teaching hospital who's saved a 10% deposit and wants to buy within the next six months. They start with home loan pre-approval, which gives them a conditional commitment from a lender based on their income, savings, and credit history. That approval is valid for 90 days in most cases, though some lenders extend it to 120 days. Pre-approval doesn't lock in a property, but it does lock in your borrowing limit and confirms you're a serious buyer when you make an offer.

Once you find a property and your offer is accepted, you sign a contract of sale. In most states, you then enter a cooling-off period of three to five business days, during which you can withdraw from the purchase with a small penalty, usually 0.25% of the purchase price. That period gives you time to arrange building and pest inspections, review the contract with a conveyancer or solicitor, and confirm your finance is on track. If you're buying at auction, no cooling-off period applies, so you need unconditional finance approval or a finance clause that's been negotiated before bidding.

How Does Formal Approval Differ From Pre-Approval?

Formal approval requires a signed contract, a property valuation ordered by the lender, and final verification of your income and deposit source.

Pre-approval is based on what you've told the lender and the documents you've provided. Formal approval is based on what the lender can verify. Once you have a signed contract, the lender orders a valuation to confirm the property is worth what you're paying. If the valuation comes in below the purchase price, the lender will only lend against the lower figure, which means you'll need to cover the shortfall with additional savings or renegotiate the price.

For hospital pharmacists working rotating rosters across multiple sites, income verification can involve payslips from different pay cycles, a letter from your employer confirming your base salary and allowances, and sometimes a contract if you've recently started a new role. Lenders treat weekend penalties, public holiday loadings, and shift allowances differently depending on whether they appear consistently across a 12-month period. If you've moved from a community pharmacy role into a hospital position within the last six months, some lenders will accept a signed contract and recent payslips, while others will ask you to wait until you've completed a probation period.

What Documents Do You Need for Settlement?

You'll need to provide your conveyancer with proof of identity, confirmation of deposit funds, signed transfer documents, and evidence of insurance from the settlement date.

Your conveyancer or solicitor manages most of the settlement process, but you're responsible for arranging building insurance before settlement and providing cleared funds for the balance of the deposit, stamp duty, and settlement costs. In Queensland, stamp duty on a property purchased under the first home new home concession incurs no duty on the residential land component for contracts signed from 1 May 2025, but you still pay duty on any commercial or non-residential use component if the property includes a mixed-use zone. In New South Wales, a full transfer duty exemption applies to new and established homes valued up to $800,000 under the First Home Buyers Assistance Scheme, with a sliding concession on properties between $800,001 and $1,000,000.

If you're using the Australian Government 5% Deposit Scheme, the lender arranges the guarantee with Housing Australia directly, and you don't pay LMI. The guarantee doesn't appear on your settlement statement because it's not a cost you pay, but it does form part of the lender's security, which is why they're willing to lend at a higher loan-to-value ratio without requiring you to take out separate insurance.

How Long Does Settlement Take After Formal Approval?

Settlement periods are set in the contract of sale and typically range from 30 to 90 days, depending on whether you're buying an established home, a new build, or off-the-plan.

For an established home, 30 to 60 days is common. That gives the lender time to complete their valuation, finalise your loan documents, and arrange for the funds to be available on settlement day. For a new build or a house and land package, settlement occurs once the property reaches practical completion, which can be six to 18 months after signing the contract depending on construction timeframes. If you're buying off-the-plan in a state with a duty concession, such as the ACT where no duty applies to off-the-plan unit owner occupier purchases from 1 July 2026 regardless of property value, you'll sign the contract well before the property is built, but you won't settle until the strata title is registered and the property is ready for occupation.

Hospital pharmacists who've been approved under Help to Buy need to allow extra time for settlement because Housing Australia's equity contribution requires additional verification steps and coordinated drawdown on the same day as your lender's portion. That usually adds one to two weeks to the standard settlement timeline, so a 60-day settlement is more practical than a 30-day settlement if you're using that scheme.

What Happens on Settlement Day?

Your lender transfers the loan amount to your conveyancer, your conveyancer pays the seller and confirms registration of the title transfer, and you receive the keys once settlement is confirmed.

Settlement is a financial transaction, not a physical handover. Your conveyancer receives the funds from your lender, pays the seller's conveyancer, and lodges the transfer of title with the state land titles office. Once the seller's conveyancer confirms receipt of funds and the title transfer is lodged, the real estate agent releases the keys. In most states, settlement happens electronically through the PEXA platform, which allows same-day registration in many cases. In some regional areas or where paper settlements are still used, registration can take several days, but you'll usually receive the keys on settlement day even if the title hasn't formally registered yet.

If you've arranged a split rate home loan with part of the loan on a fixed rate and part on a variable rate with an offset account, both portions are drawn down on settlement day, and your offset account is activated immediately so any funds you deposit start reducing the interest charged on the variable portion from day one.

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