nz-mortgage-advice

How You Can Pay Down Your Home Loan Faster

Wed, 29 Apr 2026 03:37:04 GMT

Taking on a 30-year home loan can feel overwhelming. But it doesn’t mean you’re fully committed to the home loan for the next 30 years. There are plenty of ways that you can pay off your mortgage a lot sooner. You just need the right strategy to suit you.

If you're just starting your home loan journey, our First Home Buyer Guide can help you understand what’s possible and how to get started with confidence.

Why Paying Off Your Mortgage Faster Matters

Paying your home loan off sooner can help you:

Reduce total interest paid over time.
Build equity faster in your property.
Improve long-term financial security.
Free up cash flow for lifestyle or investment goals.

5 Smart Ways to Reduce Your Home Loan Term

1. Increase Your Mortgage Repayments

One of the simplest ways to pay down your home loan faster is to increase repayments — even slightly.

For example:
A $500,000 mortgage over 30 years at 4.89% has repayments of approximately $1,223 per fortnight.

Rounding your repayments to $1,250 could:

Cut over 1 year off your loan term.
Save you $25,000 in interest.

Simply by paying $27 more a fortnight – an extra $702 a year!

For personalised calculations based on your lending numbers, get in touch.

2. Keeping Your Repayments the Same When Interest Rates Decrease

When interest rates decrease, your minimum repayments will decrease as well — but if you’re comfortable in what you were paying, you may prefer to leave your repayments as is.

Keeping repayments at the higher-level means:

More goes directly toward your loan principal.
You pay less interest overall.
This in turn shortens your term remaining.

3. Increase Home Loan Repayments As Your Income Grows

Many homeowners increase their spending as their income rises — but even small adjustments towards increasing your home loan can make an impact.

If you receive a payrise, consider increasing your home loan repayments in proportion. So say your home loan repayments equate to 25% of your income, if your pay increases, you would increase your home loan repayments as well to still be 25% of your income.

4. Use an Offset or Revolving Credit Facilty

If you have good savings habits and manage to save on top of meeting your everyday expenses, an offset or revolving credit facilty could be beneficial. These can help reduce interest paid over the life of the loan and shorten your overall loan term.

These options allow you to:

Offset savings against your home loan balance.
Reduce interest charged.
Access funds when needed.

Learn more about how these work in our guide to offset and revolving credit home loans .

5. Take Advantage of Opportunities to Make Lump Sum Payments

Making additional repayments on your home loan can significantly reduce your loan balance over time.

However, it’s important to understand:

Fixed-rate loans may limit extra repayments.
Break fees may apply if you repay early.
Variable loans generally offer more flexibility.

Paying off your home loan faster doesn’t require major lifestyle changes — just smart, consistent decisions over time.

Whether you’re based in Nelson, Hawke’s Bay or elsewhere in New Zealand, and are after personalised support, our team can help you create a clear strategy based on your goals.

Book a call with one of our mortgage advisers and let’s build a plan that helps you pay your home loan off faster.

Looking forward to hearing from you.

Fiona & Amy

How a Mortgage Adviser can support you during uncertain times.

Tue, 07 Apr 2026 01:51:44 GMT

There’s no denying how unpredictable the world feels at the moment.

From rising fuel costs and ongoing conflict overseas, to being an election year. There’s a lot of events driving uncertainty. Closer to home, questions around interest rates and property values are leaving many people wondering: Is now the right time to act, or should I wait?

The truth is that uncertainty is part of every property cycle. But what does make a difference is having the right support and guidance around you.

Whether you’re:

· Considering buying your first home.

· Reviewing your existing lending.

· Looking at an investment property.

· Or simply unsure what your next move should be.

Our role is to help guide you through the noise, finding the best path that will enable you to meet your financial goals and needs.

Making Sense of Interest Rate Uncertainty

Interest rates are naturally always a big talking point. With movements to wholesale rates influenced by both global and local factors, it can be difficult to know what might happen next.

Rather than trying to “time the market,” we focus on:

· Structuring your loan to provide flexibility and mitigate risk.

· Exploring rate options that will best work for you and your.

· Creating a strategy that works both now and in the future.

It’s not about predicting the market but putting you in a position where you’re prepared for whatever comes next.

Understanding Property Value Fluctuations

Property values naturally move in cycles. Periods of growth are often followed by stabilisation or decline — and vice versa. It’s easy to focus on short-term changes but property is typically a long-term investment.

We help you:

· Understand what current market conditions mean for you.

· Assess affordability based on your financial position.

· Make informed decisions without being driven by fear or headlines.

While we can’t control global events, election outcomes, or market fluctuations, we can control how we respond to them. With the right advice and a clear strategy, you can move forward, taking steps towards your goals. And if you're feeling unsure about the journey ahead, we’re here to help guide you through it. Feel free to book a chat with one of our mortgage advisers. We're based in Nelson and Hawkes Bay but look after clients all over New Zealand.

Fiona & Amy

New Granny Flat Rules in New Zealand — What Property Owners Need to Know in 2026

Wed, 25 Feb 2026 02:49:21 GMT

As of January 15th, 2026, New Zealand property owners are able to build small, standalone secondary dwellings — or 'granny flats'— without building consent in many circumstances.

This is a significant shift in housing and building regulations, making it easier to add additional housing onto your property.

So, what’s Changed?

Under the Building and Construction (Small Stand‑Alone Dwellings) Amendment Act 2025, homeowners can now construct a granny flat without full building consent, subject to the following conditions:

The dwelling must be new, standalone and single‑storey.
It must be no larger than 70 square metres.
It must have a simple design and comply with the New Zealand Building Code.
Any work done must be carried out or supervised by licensed building professionals (builders, electricians, plumbers, etc.).
Homeowners must notify their council before construction begins and after completion.
The new dwelling must still meet local rules surrounding the distance from boundaries and other dwellings.

Why the Change?

The government has introduced these reforms to:

Reduce regulations, making it faster to build small, affordable housing options.
Encourage multigenerational living and flexible housing solutions for families.
Help boost overall housing supply in a market where demand is high.
Support construction activity by freeing up councils to focus on more complex building projects.

While full building consent is no longer required for qualifying builds, property owners still have the following responsibilities:

Before You Build:

Apply for a Project Information Memorandum (PIM) from your local council. This replaces the building consent and ensures council records cover the upcoming work.
Check local planning and zoning rules, as resource consent may still be needed in some areas depending on local plans.
Confirm the site is suitable and not in a hazard‑prone area.

During Construction:

Only licensed professionals should undertake or supervise building, plumbing, electrical, gas, and drainage work.

After Construction:

Provide the council with all required documentation, including final plans, Records of Work from tradespeople, and compliance certificates.
Pay any applicable development contributions or fees set by your council.

Costs, Rates & Financial Considerations

Although the process has been made easier and more cost efficient, there are still costs to be considered:

Construction costs (materials, labour, utilities).
PIM application fees and possible development contributions.
Increased property rates - councils will often increase rates for properties with additional dwellings.

Things to Watch Out For

Despite the simpler process, those looking to build a granny flat under these new rules must fully understand the requirements to avoid illegal or non‑compliant structures.

Always:

· Seek professional advice early.

· Contact your local council before building.

· Keep detailed records of all work and certifications.

We hope this gave you some guidance around the new granny flat regulations. If you're looking to top up your existing lending to add a granny flat to your property, or would just like to discuss your financial goals, feel free to book a chat with one of our mortgage advisers. We're based in Nelson and Hawkes Bay but look after clients all over New Zealand.

Looking forward to hearing from you,

Fiona & Amy

Setting Financial Goals for 2026

Tue, 16 Dec 2025 21:08:23 GMT

A Guide for Homeowners, First Home Buyers, and Investors

It’s officially 2026, and usually the time where we reflect on our financial position, setting goals for the year ahead. While everyone’s circumstances are different, having defined financial goals can help provide direction, confidence, and a framework for better decision-making.

Whether you already own a home, are working towards your first purchase, or are building a property investment portfolio, setting clear, achievable goals will help you take that next step in your journey.

We’ve outlined some important things to consider when looking at your financial goals for the year ahead. Broken down into what your position is, whether you’re a homeowner, first home buyer or property investor.

Tips For Homeowners: prioritising stability and growth

For homeowners, financial goals often focus on balance — managing todays costs while planning for future security.

When setting goals for 2026, consider the following:

Review your home loan structures and repayment strategies – can you adjust these to save on interest in the long run?
Can you improve cashflow by cutting unnecessary expenses?
Are you planning for any renovations or maintenance?
Do you have the opportunity to build equity or increase your savings?
How can you better prepare for potential changes in income or interest rates?

Even small adjustments, such as reviewing your home loan regularly or increasing repayments where possible, can make a difference over time. The key is ensuring that your lending and financial decisions continue to support your broader lifestyle and long-term plans.

Tips For First Home Buyers: Turning a goal into a plan

For those considering home ownership, 2026 may be the year this goal becomes a reality — or a year to lay stronger foundations.

If owning a home is a goal of yours, consider the following:

What are ways you can build a deposit?
How can you improve your savings habits and better manage your spending?
Could you speak to a mortgage adviser about your potential borrowing capacity and current bank lending criteria?
Can you reduce any existing debts?
Are you familiar with the buying process and associated costs?

Clear, realistic goals can help make the path to home ownership feel more achievable. Breaking the journey into steps — such as improving financial readiness first — can reduce pressure and provide greater confidence when the time comes to buy.

Tips for Property Investors: Optimising performance and resilience

For property investors, goal setting is often based around performance, cash flow, and long-term property investment portfolio sustainability.

When planning for 2026, investors may consider:

Reviewing your portfolio structure and loan arrangements – checking with your accountant to ensure these are best suited to your long-term goals.
Are there ways you can be better manage your cash flow and interest rate exposure?
Are there any upcoming lending or regulatory changes you need to prepare for?
Assess your opportunities for growth or consolidation.
Do you have sufficient buffers in place for unexpected costs?

Strong financial goals can help investors stay focused on strategy rather than short-term market noise. Regular reviews are particularly important to ensure lending structures and property investment portfolio performance remains aligned with investment objectives.

We hope these points help you when goal setting for 2026. If we’re able to help you achieve any of your lending goals, feel free to book a chat with one of our mortgage advisers based in Nelson and Hawkes Bay, looking after clients all over New Zealand. We'd love to help!

Looking forward to hearing from you,

Fiona & Amy

Supporting NZ businesses with Prospa

Tue, 11 Nov 2025 03:23:50 GMT

We're proud to work with Prospa, a company providing lending to local businesses across NZ.

With over 10 years in the industry, Prospa provide businesses with financial management that's simple, stress free and seamless. They're proud to support local businesses across NZ, providing a great depth of knowledge and understanding of small businesses needs.

Listening, learning, and evolving alongside their customers, Prospa has made a positive impact in the market, continuing to be pioneers in providing streamlined processes and products for small businesses.

All About Prospa...

Prospa offers a range of business lending options to best suit the customer. They have an application process that is simple and straightforward with clear guidelines of the information needed.

Here are some reasons why small businesses are choosing Prospa:

Speed - Applications in under 10 minutes, quick decisions and funding possible in hours.
Flexibility - Make business happen with their range of lending products designed for what your business needs.
Support - Their dedicated  Business Lending Specialists get to know you, and your business.
Confidence - Join thousands of small businesses who thrive with the support of Prospa.

Loan Options...

With their strong ideals and great expertise, Prospa have formulated three loan types to best suit businesses in New Zealand:

Prospa Small Business Loan
• Same-day access to $5K - $150K to keep your business moving.

• Terms up to 3 years

• Easy application process with fast approvals and funding possible in hours

• Make unlimited extra repayments to save on your interest

• No asset security required upfront to access Prospa funding up to $150K

Prospa Business Loan Plus
• Access $150K - $500K to invest in a plan to take your business further.

• Terms up to 5 years for lower weekly repayments.

• Pre-approval available for loans above $250K, no credit check required.*

• Upfront asset security required; charge over the applying business entity(ies).

• Property ownership required, have a minimum 3 years trading history and $1M annual turnover to apply.

Prospa Business Line of Credit
• Ongoing access up to $500K to simplify your cash flow.

• Unlimited access for 2 years, with option to renew.

• Fast approvals and funding possible in hours.

• Only pay interest on the funds you use.

• Access funds anytime, wherever you are with the Prospa App or Prospa Online.

*Lending criteria and terms & conditions apply.*

If this has sparked your interest in applying for a business loan through Prospa, please feel free to get in touch to discuss your needs.

Looking forward to hearing from you,

Fiona & Amy

Refer a Friend! - Limited Time Offer

Tue, 30 Sep 2025 01:48:22 GMT

We wanted to take a moment to say a big thank you for your ongoing support of NZ Mortgage Advice.

Helping people into their new homes and finding the right lending solutions is truly the most rewarding part of what we do — and we couldn’t do it without you.

To thank you for your continuous support of our business, we're excited to share a special referral reward offer!

If you refer a friend to NZ Mortgage Advice and they settle a new home loan before 31/03/2026 , you’ll receive a $250 reward as a thank you for passing on your experience.*

*Lending criteria, terms & conditions apply.

If you’d like to learn more about the offer — or simply chat about your own lending goals — we’d love to hear from you.

Once again, thank you for being part of the NZ Mortgage Advice community.

Amy & Fiona

NZ Mortgage Advice

Clean Energy Loan Options

Tue, 26 Aug 2025 21:31:26 GMT

If you're looking to make some sustainable upgrades to your home, your lender may have a lending option for you that isn't going to cost you lots in interest...

New Zealand's main bank lenders each have special offers for customers looking for lending on sustainable and energy efficient purchases such as electric vehicles, home insulation, and solar energy.

Here are some options you may be able to get a clean energy loan for:

Sustainable product options

Home insulation
Heat pumps
double glazing
Ventilation
Wood burners
Solar power systems and batteries
Electric/Hybrid vehicles (and/or chargers)
E-bikes
Small-scale hydro, wind energy or geothermal resources that is for sale to the general public and have at least 10 year warranty.
Sustainable water upgrades

*Terms & conditions apply specific to individual lenders. Purchases must be made within lenders required timeframe.

What are lenders offering?

Westpac

0% interest on up to $50,000 for five years with a Westpac Greater Choices home loan.
Flexibility to make lump sum payments or pay the loan off earlier without prepayment costs.
Available for new or existing Westpac Choices home loan customers.
No establishment fee.

ASB

1% interest per annum on loans of up to $80,000 fixed for 3 years.
You must be an existing ASB home loan customer.
Equity required is a minimum of 20% for owner-occupied properties.
Only available for eligible improvements and purchases, ASB's lending criteria and terms apply.

ANZ

Top up your existing ANZ home loan by up to $80,000 at a fixed rate of 1% over 3 years.
Not available for business purposes or for new builds (until the new build lending is fully drawn).
New customers can apply for ANZ Home Loan and Good Energy Loan top up at the same time.
ANZ Good Energy Home Loan top ups are not available for upgrades that have already been purchased, unless otherwise agreed by ANZ.
ANZ's lending criteria and terms apply.

BNZ

1% interest p.a. loan fixed for 3 years to the maximum amount of $80,000.
Available for new and existing customers.
Equity required is a minimum of 20% for owner-occupied properties.
Lending to be documented up to a 30-year term and as a 'Classic Home Loan" fixed for a maximum of 3 years (standard rates apply thereafter).
Not eligible for business purposes.
An establishment fee of $150 may apply for new customers or $100 for customers completing a top up.
Standard BNZ home loan policy applies.

Kiwibank

If you borrow more than $5,000, Kiwibank will contribute up to $2,000 over four years towards the cost of the system and $400 at the end of each of the following years.
If an existing Kiwibank Home Loan customer, the home loan top-up fee will be waived.
The sustainable energy loan is a variable rate home loan. The minimum loan term is 7 years and the maximum term is 10 years. It's not available with an offset home loan or a revolving home loan.
Usual Kiwibank home loan lending criteria and terms apply.

If this has got you thinking about your options when it comes to getting a clean energy loan, please feel free to get in touch today and we can create a tailored plan that will be best suit your situation.

Looking forward to hearing from you.

Fiona & Amy

NZ Mortgage Advice

Buying a property using self-employed income

Fri, 25 Jul 2025 00:38:02 GMT

For self-employed Kiwi’s, you’re usually prioritising making your business as profitable as possible while taking only a small income for yourself. However, you then try to purchase a property, and you’re told you need as much income as possible. It can be a fine line to walk however by working with a mortgage adviser and your accountant, buying a property is definitely an option for you.

Firstly, preparation is key. In most cases, lenders will require you to have a minimum of two years financial statements in order to assess your income. This means if you are newly self-employed, you’ll typically have to wait two years before applying for a home loan. Prior to buying a home we recommend taking the time to speak with your accountant to ensure the way you’re operating your business and profit is optimal in the eyes of the bank. This way when the time comes and you approach a mortgage adviser; your accounts are prepared to help you secure the lending you require.

When you’re self-employed and applying for a home loan, the documents required are a little different. Here’s a summary of what will be required.

Two years of financial statements, or at least a minimum of 1 year.
Latest IRD personal tax summary (IR3)
Your business bank statements as well as bank statements for all relevant personal bank accounts
Any documentation & evidence of business liabilities
Potentially a year-to-date profit and loss statement for the business

How lenders will assess self-employed income:

Firstly, the lender will look at your financials, checking for the business’s profitability over the last few years as well as your salary as a shareholder. Your personal income / shareholder salary is what the lender will use for your income calculation which can either be your most recent annual salary, an average of your last two years or the lowest of the last two years depending on the lenders policy.

Lenders will in some cases include your ‘add-backs’ into your income as well. These are expenses reported in your business financial statements that may be considered non-essential such as home office, depreciation, and interest, and therefore can be added back to your income. Lenders will often scale the add-backs to mitigate the risk of using them to work out your affordability.

They’ll then check for any business liabilities and often this will be included in the affordability assessment as you are still liable for this debt regardless of it being in the business name.

Lenders will also assess your business bank statements; however, any business expenses are excluded from the affordability assessment including any personal expenses that are run through your business.

Once they’ve assessed your financial position, they’ll complete your assessment based on your financial statement of position, checking your personal expenses/debt and overall position to determine if you meet the banks requirements for the lending amount requested.

If you’re self-employed and dreaming of homeownership, feel free to get in touch and we can walk you through your options and help make your path to property ownership smoother.

Fiona & Amy

NZ Mortgage Advice

Purchasing an Investment Property with Existing Equity

Mon, 30 Jun 2025 02:15:27 GMT

Building wealth through property investment is a goal for many who are thinking long term about their retirement.

This was the case for one of our recent clients, who were able to purchase an investment property using their existing equity.

We thought we’d walk you through how these clients achieved this and how it may be a possibility for you. Whether you're curious about your own options or just starting to explore purchasing an investment property, their story might inspire your next move.

Client example:

The clients initially got in touch as they were wanting to purchase a new investment property using their equity held in their owner-occupied home. They also noted wanting to refinance their existing lending to a new lender at the same time. We prepared a lending application to a new lender noting their existing home as security for the new purchase as well as what the new rental income would be. We also calculated the estimated additional costs associated with buying an investment property such as rates and insurance as these would affect their day-to-day cashflow.

As the clients had a great equity position, along with good income including the proposed rental income, they had no issue getting a pre-approval in place. They then found a property that fit their vision and after completing the sale and doing some renovations, they now have lovely tenants in the house.

Here's an example of how their equity position was calculated:

Say you have an owner-occupied home valued at $900,000 with a home loan of $400,000.

You wish to purchase an investment property for $500,000 but you’re unsure of your equity to secure the new home loan. Here’s an equation to work this out:

Owner occupied home value $900,000 @ 80% LVR (Loan to value ratio) = $720,000 less existing home loan of $400,000 = $320,000 spare equity.

Investment property value $500,000 @ 30% LVR deposit / equity required = $150,000

Result = Owner occupied property has sufficient equity to secure a full lend on an investment property with no further deposit funds required to add to the equation.*

*Please note lending is always subject to the lenders terms & conditions and servicing policy applies.

So, if you know your homes value, you can use the calculations above to work out whether you have enough equity to purchase an investment property. Alternatively, you can get in touch with one of our mortgage advisers who are able to run these numbers as well as assessing your lending affordability.

If you’d like to get in touch to learn about your lending options, feel free to get in touch. You can also subscribe to our monthly newsletters where we provide information on the latest housing market updates.

Fiona & Amy

NZ Mortgage Advice

A tip for First Home Buyers

Fri, 23 May 2025 03:30:17 GMT

A positive outcome for a recent first home buyer...

We often see comments online from prospective first home buyers who are eager to purchase their first property but are unsure if they would be able to afford a home loan based on their financial position and credit history.

Often these clients aren’t quite in the position to purchase their first home, but it doesn’t mean they’re not on their way. We always recommend speaking with a mortgage adviser just to get an idea of what you could potentially borrow and what the steps you’d need to take are to get there.

It’s common for our clients to take time to get purchase ready, paying down debt, improving their bank account conduct and growing their savings.

Here’s a success story from a recent client of ours.

Client example:

We recently helped a lovely family into their first home.

The couple approached us a couple years ago, with the goal to purchase their first home. At the time, they had short-term debt along and some credit history issues and poor account conduct. Unfortunately, this meant it wasn’t quite the right time to purchase a property for them, especially while the interest rates were at their peak.

We prepared some rough figures of what the couple could achieve having put in the work to ensure they were putting in their best foot forward in the eyes of the lender.

The clients were super determined to make their dream happen, so they went away and spent the next year paying down their existing debt and growing their deposit until it was time to reassess their financial situation.

Sure enough, their hard work had paid off and they were able to secure a home loan pre-approval. After some house shopping, they decided to put an offer on a property within their budget. Their offer was quickly accepted and a month later they were moving into their new home!

So, if you have the goal to purchase your first home, but don’t think your finances are quite there, this isn’t the sign to give up hope. Rather, get advice from the mortgage adviser or simply look into tips and tricks on how to better your financial position. This could come from sticking to a budget or cutting back some of your expenses. Just because you may not be able to buy a house right now, doesn’t mean you won’t be able to in 6 months, 1-year or even a couple of years with a bit of hard work.

If you’d like to get in touch to learn about your lending options, feel free to contact us using our details below or head to our website. You can also subscribe to our monthly newsletters where we provide information on the latest housing market updates.

Looking forward to hearing from you soon.

Fiona & Amy

NZ Mortgage Advice

Refix, restructure or refinance? How to ensure your home loan continues to work for you.

Wed, 30 Apr 2025 00:12:58 GMT

Often clients think that once settlement has been completed, they set and forget about their home loan for the next 30 years.

Now you can definitely do this to a degree, but we recommend keeping your lending in the back of your mind, reviewing it every now and then to ensure it is still working in your favour.

In 30 years, your life is without a doubt going to look a little different. You have different priorities and goals compared to when you first got your home loan. Your lending should evolve with you. That can be as simple as refixing for various time periods to suit your shorter-term goals, or you may look to restructure or refinance your loan completely to better suit your needs. Let’s have a look at what these options would look like.

Refixing your home loan

Definition:

This is when you set your home loan to a ‘fixed’ interest rate for a set timeframe varying from 6-months up to 5 years. The interest rates are set by the lender and you won’t be able to change your interest rate until the end of the fixed term without incurring fees.

Alternatively, you may leave your home loan on a floating or variable rate which is an interest rate that is once again set by the lender however it varies over time and doesn’t have a fixed timeframe. This gives you flexibility but often this interest rate is higher than the fixed rates meaning you’ll likely pay more interest over time.

When refixing your home loan fixed or floating rate terms, it's important to assess if you have surplus funds in your budget that you could use to increase your home loan repayments. This would enable you to pay down your loan much faster and could result in saving thousands in interest costs over the duration of your loan term.

Advantages:

Certainty of your repayments for the set period of time.
Secures your lending from fluctuations in interest rates.
Gives you the option to budget based on your repayments.

Disadvantages:

There will be break fees should you wish to break your fixed term.
You risk missing out on future interest rate decreases.
There's less ability to pay down the loan sooner.

Restructuring your home loan

Definition:

A home loan restructure is when you look to either split your lending into smaller loans, or add them together. It also involves changing the types of loans you have such as changing a fixed home loan to a revolving credit or offset loan.

Advantages:

This gives you the opportunity to spread your risk, breaking your lending into smaller loans and setting them to various fixed terms.
You’re able to action a debt consolidation, adding your short term debt to your home loan.
It gives you access to different lending products such as a revolving credit or offset loan.

Disadvantages:

You may incur fees if you break any existing loans.
It may be harder to keep up with your lending if you have multiple loans or a revolving credit.

Refinancing your home loan

Definition:

This is when you transfer your home loan to a new lender, maybe due to better interest rates at the time of better policies and product offerings.

Advantages:

This gives you the opportunity to make the most of competing interest rates across different lenders.
You'll also have access to different products and services that may help you pay down debt sooner.

Disadvantages:

You may be subject to break fees and lawyer fees when completing the refinance.
If you have only had your lending for a short period of time and received a cash contribution upon settlement you may have to pay a portion of this back to the lender.

These are all great options to consider when reviewing your home loan to ensure your lending continues to work for you. If you’d like to learn more about these options, please get in touch with one of our mortgage advisers who can provide tailored advice fit to your situation.

Looking forward to hearing from you soon.

Fiona & Amy

NZ Mortgage Advice.

How much deposit do you need for an investment property in NZ?

Fri, 21 Mar 2025 03:33:40 GMT

The process to buying an investment property is fairly similar to buying an owner-occupied property. One of the clear differences between these lending processes is the required deposit.

When applying for lending on an investment property, a minimum of 30% deposit is required vs 20% for an owner-occupied. When sourcing finance for standard residential investment property purposes the bank’s as a general rule will lend to 70% of the properties market value.

An investment property deposit can come from the following places:

Existing Equity – Depending on the equity held in your owner-occupied property you may be able to use these funds as the deposit for your new standard residential investment property. In this instance you would evidence to the bank that you have the 30% deposit held in equity but you would still require lending of the full purchase price as your equity isn’t money that you can draw on as such.

How to work out your equity position:

Example: You have an owner-occupied home valued at $900,000 with a home loan of $400,000.

You wish to purchase a standard residential investment property for $600,000 but you’re unsure of your equity to secure the new home loan. Here’s an equation to work this out:

Owner occupied home value $900,000 @ 80% LVR (Loan to value ratio) = $720,000 less existing home loan of $400,000 = $320,000 spare equity.

Standard Residential Investment property value $600,000 @ 30% LVR deposit / equity required = $180,000

Result = Owner occupied property has sufficient equity to secure a full lend on a standard residential investment property with no further deposit funds required to add to the equation.*

*Please note lending is always subject to the lenders terms & conditions and servicing policy applies.

Savings – Putting away savings from your income regularly not only grows your deposit but also demonstrates to the bank that you have the ability to save while managing your existing home loan repayments.

Gifted funds – Family members can gift you a sum of money that helps with any shortfall you may have with your deposit funds. The bank will require a gifted letter confirming these funds.

Guarantees – A family member can provide a guarantee over your loan if you have little or no deposit. This allows them to use their equity without having to provide any money upfront. However, if you fail to make a repayment your guarantor is then liable.

Once you can confirm you have a 30% deposit requirement for a standard residential investment property purchase, you will need to apply for a home loan pre-approval where the lender will assess your full financial statement of position as part of their debt servicing assessment process.

If you’d like to get in touch to learn about your lending options, feel free to book an appointment with one of our mortgage advisers. You can also subscribe to our monthly newsletters where we provide information on the latest housing market updates.

Looking forward to hearing from you soon.

Fiona & Amy

NZ Mortgage Advice.

What are your Deposit Options?

Wed, 26 Feb 2025 00:22:34 GMT

What are your deposit options when it comes to buying your first home? Lots of people may think that if you don’t have enough savings, you won’t have a big enough deposit for your home loan. This isn’t quite true!

A home loan deposit can be made up of different funds aside from your savings. Although demonstrating effective savings is highly recommended in the eyes of lenders, a deposit may be from a couple different sources such as your Kiwisaver or gifted from a family member.

There are several things to consider when you’re thinking of buying a house – what size deposit you’ll need, how you’ll save for your deposit, and how you’ll afford your ongoing home loan repayments.

Personal Savings – Putting away a chunk of your income regularly not only takes you closer to a deposit but also demonstrates to the bank that you have the commitment you’ll need for a home loan.

Good habits to maintain before and during paying a home loan:

o Keep track of your spending.

o Before you buy something, ask yourself ‘Do I really need this?’

o Automate your savings so your money is out of your account before you get a chance to spend it.

What are your deposit options aside from savings?

Kiwisaver – You may be able to withdraw money from your Kiwisaver to buy your first house – you’ll need to fill out the paperwork with your provider and have the funds pre-approved for withdrawal before offering on a house. If you don’t know what Kiwisaver provider you’re with, you can call Inland Revenue and they’ll be able to tell you.
Gifted funds – Family members can gift you a sum of money that helps with any shortfall you may have with your deposit funds. The bank will require a gifted letter confirming these funds.
Guarantees – A family member can provide a guarantee over your loan if you have little or no deposit. This allows them to use their equity without having to provide any money upfront. However, if you fail to make a repayment your guarantor is then liable.

If you’d like some more information about your deposit options, we also have a First Home Buyers Guide to Lending document which provides further guidance on the process as well as some definitions to terms you’ll come across. You can download our guide for free from our website.

Looking forward to hearing from you soon.

Fiona & Amy

NZ Mortgage Advice.

Preparing your Home Loan Application

Fri, 07 Feb 2025 02:33:39 GMT

Preparing your home loan application can be a straightforward process with the right tools and a mortgage adviser by your side.

When applying for a home loan, you want to make sure you’re well prepared for what to expect. Once you start thinking about contacting a mortgage adviser, you should assess your current financial position to have your own understanding of your needs when it comes to a home as well as what you can comfortably afford to pay in loan repayments.

Here are couple steps you can take before approaching a mortgage adviser:

Create a budget with your negotiables and non-negotiables – where can you reduce your spending and/or make cuts? If you had to prioritise your home loan repayments over everything else, what could you reduce your expenses to?
Secondly, you will need to maintain a minimum of three months clean account conduct, avoiding any missed payments or cash advances.
If you have any existing debt, is this something you can pay off prior to your home loan application?
If possible, demonstrating some consistent savings will make a good impression with the lender showing your commitment to repaying your loan.
Review your living situation and the requirements for your family – have a look at houses similar to what might suit your needs and what these houses are listed for.
Establish how much you personally could afford based on your budget, using an online repayment calculator.
Assess your deposit size, will you be applying with 20% or less? Are you eligible to use your Kiwisaver?
A final step is to confirm your ongoing income. Have you had consistent employment over the last 1-2 years? Are there any foreseen circumstances that may affect your income?

Once you’ve worked on your financial situation, you can approach a mortgage adviser with an understanding of what your options may be. A mortgage adviser will then complete a full assessment and find the best option for you.

If you’d like some more information on preparing your home loan application, we also have our First Home Buyers Guide resource which provides further guidance on the process as well as some definitions to terms you’ll come across.

If you’d like to get in touch to learn about your lending options, feel free to contact us using our details below. You can also subscribe to our monthly newsletters where we provide information on the latest housing market updates.

Looking forward to hearing from you soon.

Fiona & Amy

NZ Mortgage Advice

Common Mistakes When Buying a Home

Mon, 02 Dec 2024 06:26:39 GMT

Buying your first home can be both an exciting and equally stressful experience...

There are lots of steps throughout the process and some things may go wrong from time to time. However, at the end of the journey your efforts are rewarded with a house for you to call home!

We thought we could help ease some stresses of the home buying process by outlining some common mistakes that home buyers make so you can avoid them. Let’s get started!

Not understanding lending terms and the steps to buying a home.

Going into the home buying process with an understanding of the housing market, lending jargon and general process instantly gets you started on the right foot. That way as you undergo the home buying process, you can understand what’s in motion while dealing with your mortgage advisor, lawyer and real estate agents.

We have a guide to buying a home filled with some general information and tips. To download our home buyers guide, follow the link below.

Not considering your long-term goals and ambitions.

Before buying a home, you should always consider what your financial goals are in the next 5, 10, 20+ years to ensure the purchase aligns with these. Buying a house is a huge investment and, in many cases, a big debt that you take on.

Not using a mortgage advisor.

We may be bias, but we know first hand how beneficial using a mortgage advisor can be. The role of a mortgage advisor is to provide a helping hand across the journey to home ownership, not only finding you the best lending solution tailored to your situation, but to also communicate with the lender, lawyer and real estate agent ensuring the process runs smoothly.

Not getting a pre-approval prior to offering on a property.

Getting a pre-approval before house shopping is a an absolute must. A pre-approval not only gives you the indication of how much you can borrow but it also enables you to make a more solid offer on a property in a competitive market. This decreases any risk of having your offer accepted on a home only to find out you aren’t able to service the loan size.

Getting your heart set on a property.

It’s natural to fall in love with a property, but it’s important to be pragmatic when buying a house. Otherwise, you may find yourself overlooking issues with a property out of desire to purchase it. It's also likely that there may be interest from other parties in the property and you may miss out. Keeping your options open minimises the risk if the property you’re wanting doesn’t work out.

Not completing your due diligence

Due diligence is essential when buying a property. You want to ensure that you minimise as much risk as possible. This comes down to checking the property for any significant issues such as hazards or repairs.

Due diligence includes:

Completing a building report or LIM report before going unconditional on a property.
Researching the neighbourhood and looking into what the long-term value may be.
Getting confirmation that the house is fully insurable without any exclusions.
Complete Solicitor due diligence.
Confirm finance conditions required by your lender.

Stretching your budget too thin without considering unexpected costs.

Often clients are so eager to get into their first home that they use as much of their savings as possible to increase their deposit size. This can lead to stress if any unexpected costs arise such as the lender needing a registered valuation or if the property needs any repairs.

Having an emergency fund or savings to cover any unexpected costs can be a life saver in these situations. Not only do these provide a safety net but if you don’t end up using them, they can go towards big purchases involved in the purchase like new furniture or hiring movers.

Structuring your lending with little market analysis.

If the interest rate trends over the last five years have taught us anything, it’s that we can never quite predict what’s going to happen next. This can make for structuring your home loan tricky. We recommend researching what NZ economists are saying about interest rates along with speaking to your mortgage advisor to make an educated decision on how to best mitigate any risk.

Example: Some people had previously fixed their home loan for 3-5 years while the interest rates have been high. Now that they are falling, they are stuck with this high interest rate or would face large break fees to change their lending.

We hope you found some valuable tips to take into your next home purchase. For more information on the home buying process, get in touch with one of our mortgage advisors for a free, no obligation chat.

We look forward to hearing from you,

Fiona & Amy

Let's Talk About Interest Rates

Tue, 05 Nov 2024 23:01:21 GMT

The last five years have been extraordinary to witness as the Reserve Bank has managed interest rates while trying to minimise the economic impacts of world events.

We've seen polar opposite circumstances with both interest rates and house prices, riding the lows and highs without much certainty of what is going to happen next.

With this uncertainty, we thought we'd take a moment to unpack the current New Zealand Housing Market and what things to keep in mind when managing your lending.

What Are House Prices And Interest Rates Doing?

House Prices

House prices peaked end of November 2021 before we saw a big decline in both values and sales. In Hawkes Bay as of July 2021, the annual number of house sales was 2,763 whereas this July we saw annual sales of 2,181, an increase from the low of 1,879 in early 2023. Alongside this, the nationwide median house price is down $160,000 sitting at $765,000 as of August 2024 compared to $925,000 in November 2021.

There are a couple reasons for this decline. Leading factors are of course the economy and the recovery following the 2020 pandemic where we saw interest rates plummet to as low as 2% and inflation reach 7.3%. This created what you may hear as the 'housing boom' sending house prices up as our population rapidly grew and demand soared with new buyers maximising this opportunity. However, these are conditions that steered us towards a recession. With the cost of living heightened, the Reserve Bank of New Zealand put the brakes on and increased the Official Cash Rate (OCR) to help ease inflation. This sent interest rates up into the 7%'s, creating a decline in house prices and purchases as Kiwi's eased out of the market while costs in other sectors remain high.

To learn more about some of the concepts mentioned above, check out some of our other blogs or head to our social media.

Interest Rates

To homeowners delight, interest rates are back to a declining nature as the Reserve Bank has started to decrease the OCR from it's peak at 5.5% where it previously remained for over a year. The OCR is currently sitting at 4.75% with more decreases expected to come. Along with this, lenders have also started to ease policy, making it more achievable for buyers to purchase. This year alone, we've seen changes to Debt-To-Income (DTI) rules as well as easing on CCCFA policy. These are all aiding in bringing buyers back into the market which is likely to increase house prices.

It is important to note that we are still in a recovery phase with no set prediction of what will happen in the next 1, 5 or 10 years. There are still a lot of factors contributing to our market such as conflict overseas, the upcoming US election and movements as countries make changes as they manage their own inflation. That's why we can't recommend more speaking to an expert or researching before your next property purchase or fixed rate rollover.

We hope some of these tips are helpful and have got you thinking about how you can adjust your finances to decrease your loan term. If you'd like to know more about these options or are looking for assistance with your lending, please don't hesitate to get in touch.

Looking forward to hearing from you,

Fiona & Amy

Tips on Decreasing the Length of your Home Loan

Wed, 02 Oct 2024 01:50:43 GMT

The moment your first home loan payment is deducted from your bank account, I bet you think "Wow, is that really going to happen for the next 30 years?"

We know 30 years is a long time, but in most cases it doesn't take 30 years to pay off your home loan. This is due to varying interest rates, potential downsizes or maybe adding some additional funds to your home loan.

None the less, we thought it would be helpful to understand some small things you can do that will cut time off your loan term. Of course not all of these may work for you but there may be one that is approachable in your situation.

Tricks That Will Decrease Your Loan Term:

Increasing your minimum payments

Now this one might seem like a no-brainer but when people consider increasing their repayments, they think this has to be a huge amount to make an impact. This isn't the case at all!

Example: You have a 30-year $500,000 home loan with an interest rate of 6.85%. This means your fortnightly repayments are $1,511. This is already a significant deduction from your wages but an increase doesn't have to be significant. If you were to increase your repayment to $1,550 (a difference of $39) you will decrease your estimated loan term from 30 years to just under 28 years as well as save you $64,409 in interest over the term of the loan.

As interest rates drop, continue paying if they were still high

A benefit to our current market is that interest rates are decreasing which will provide relief for many households. For those home owners who got through the peak of interest rates and were able to adjust their budget accordingly, you may look to consider keeping your repayments a bit higher as the rates start to fall.

Increase your repayments based on your pay increases

We often find as clients salaries increase, so does their spending. In this instance it's totally understandable to treat yourself for your hard work. However, this is also a great opportunity to review your home loan repayments amongst your overall budget and increase your repayments based on your comfortability. This change doesn't have to absorb your pay increase, but rather be a percentage of the increase that you're comfortable with.

Using a revolving credit or offset if you are a good saver

If you find you are good at savings or have funds not currently being required, an offset home loan or revolving credit facility could work to your advantage to decrease your loan term. Both options help you pay down your home loan more quickly by minimizing interest payments and giving you flexible access to funds at any time without penalty.

Adding lump sums to your home when your lender allows

We often get asked by clients how often they can put a lump sum on their home loan. Maybe if they've been able to save up on the side or come into some funds. This is a great way to decrease the size of your loan however it's important to note that majority of lenders may charge an early repayment fee if you home loan is within its fixed rate contracted period. The most common time to add funds to your home loan is when the loan comes off a fixed interest rate to avoid any break fees or in some cases specific lenders will have a set amount you can repay off your home loan or increase your repayments without penalty within their terms and conditions. Before proceeding with this option, we recommend seeking advice from your mortgage advisor or your bank to understand their policy surrounding this. If your home loan is on a variable rate the ability to make lump sum payments or increase your repayments is much more flexible.

Looking forward to hearing from you,

Fiona & Amy

Did You Know That We Help You With All Types Of Lending Not Only Residential Home Loans?

Mon, 02 Sep 2024 01:40:43 GMT

We spend a lot of time discussing home loans but did you know we also assist with other lending options as well?

As mortgage advisors, we not only assist with residential lending advice but also cover commercial and other lending solutions as well.

What Lending Can We Help You With?

First Home Loans
Residential Loans
Commercial Loans
Construction Loans
Bridging Finance
Debt Consolidation
Asset and Cash Flow Funding
Personal Loans
Home Loan Top Ups
Fixed Rate Renewals

Case Studies: Clients We've Helped With Non-Residential Lending

We've put together a couple of examples of how we've helped previous clients with lending that didn't quite fit the box:

Case Study 1: Commercial Lending

Clients had existing commercial lending and were looking to top up their existing funds for securing a new lease and expanding their business while using some additional funds to set up the new property for their business operations.

Once we gathered all their financial information including the business accounts for the last two years, we submitted this application to the bank and had it approved for a 15-year loan term which suited the clients requirements.

The clients decided to structure the loan as a revolving credit as this allowed them to call on portions of the loan when needed while they worked on the getting the new property ready for business. Once these changes were complete, the clients changed the loan to a fixed rate.

Case Study 2: Debt Consolidation

A client wished to refinance their home loan as well as complete a debt consolidation and a top up of lending for their existing personal debt and to purchase a new asset. They were working really hard to pay their existing debt and knew completing a debt consolidation would be more efficient while saving on interest costs.

Using their existing equity, we submitted their application and successfully had lending approved to cover all their required debt repayments as well as additional for their new asset purchase. The client then fixed for 1-year on an interest rate that significantly smaller compared to before the debt consolidation was completed.

If you're after some lending that's a little more complex, please don't hesitate to get in touch or make an appointment as we may be able to help.

Looking forward to hearing from you,

Fiona & Amy

Helping Offshore Kiwi's Buy In New Zealand

Mon, 05 Aug 2024 02:11:20 GMT

This month, we're looking at the options for Kiwi's living overseas when they want to buy property in New Zealand...

If you or a family member are a New Zealand citizen currently living overseas, you may not know what your options are when it comes to buying property in New Zealand. This can seem like an impossible task but we're here today to debunk this myth.

I live overseas but wish to buy a home in New Zealand? How is this possible?

As New Zealand Citizens, and often residents, you are able to purchase from overseas without any additional processes. In this situation, you will be subject to the typical lending requirements where the lender will lend to 80% of the property value if you have intention to live in this property. Otherwise they will lend to 70% of the property value for investment properties.

On top of these lending rules, there are some additional considerations lenders take in ensuring you are able to service the loan from overseas. *Full lending criteria and some terms and conditions may apply.

Lender Policies:

Different banks and financial institutions have varying policies regarding offshore borrowers. You'll need to find lenders willing to work with international clients and that’s where as your Mortgage Adviser, we’re here to help.

Deposit Requirements: Some l enders may require a higher deposit from offshore borrowers. In some cases, it could be 30% or more of the property value.

Scaling your income:

You'll need to provide comprehensive documentation of your income and financial situation. This might include bank statements, tax returns, and proof of assets. Due to changing economic conditions and foreign currency, New Zealand lenders may scale your overseas income when you apply for a home loan. The scaling is to account for the currency exchange and the risk of future changes.

Currency Exchange and Costs:

Exchange Rate Risk: If you're deposit funds are in a foreign currency, fluctuations in exchange rates can affect your overall amounts required at time of settlement. You need to be aware of how this may effect your deposit amount.

Fees and Charges: Additional costs such as foreign transaction fees, loan establishment fees, legal fees, and potentially higher interest rates may apply for international borrowers. It is best to discuss with your mortgage advisor prior to progressing with the loan if you are unsure of any fees you may be subject to.

Legal and Tax Considerations:

Legal Representation: Engage with a local lawyer who specializes in property law to guide you through the process and ensure compliance with New Zealand laws. This will mitigate any risk by ensuring you are across all New Zealand laws when it comes to buying property while living overseas. Your lawyer will also be able to assist you throughout the process with any queries or concerns you may have.

Tax Implications: It's important to understand the tax implications both in New Zealand and your home country when it comes to buying a property. These will vary from country to country so it's always best to research these prior to applying for lending.

As mentioned above, it's fully achievable to purchase property in New Zealand as a Kiwi living overseas. Although, some parts of the process may be different to regular lending, as your mortgage advisor we will guide you through the journey, helping you navigate each step.

If you're looking for further information on your lending options when it comes to buying from overseas, please don't hesitate to get in touch or make an appointment.

Looking forward to hearing from you,

Fiona & Amy

Financial Tools We Love

Wed, 17 Jul 2024 02:47:30 GMT

We thought we'd share some of our favourite tools we use for developing our understanding of the financial industry and housing market...

We hope everyone is having a good week and keeping warm during these winter months. As we (hopefully) get into warmer weather, it’s usually a common time of year where people do a spring clean of there finances and assess where they’re sitting ahead of the holiday season.

We thought it would be a great opportunity to provide some recommendations of financial resources we love. We’ll be covering some podcasts, books and websites, all of which provide great insight into not only the housing market but also financial wellbeing and optimisation.

The following is a list of helpful financial tools to grow your knowledge on the housing market alongside growing finances and investing.

Podcasts:

- Cooking the Books by Francis Cook

- Finance AM by Westpac Bank

- 5 in 5 with ANZ by ANZ bank

- NZ Everyday Investor with Darcy Ungaro

Books:

- Girls that Invest by Simran Kaur (also a great podcast)

- Rich Dad, Poor Dad (a classic), by Robert Kiyosaki, Sharon Lechter

- She’s on the Money by Victoria Devine

- The Psychology of Money by Morgan Housel

Websites:

- Realestate.co.nz

- Interest.co.nz

- And of course, our blog where we release monthly updates based on the current housing market.

Got any recommendations? We’d love to hear them. You can leave a comment below or message us on social media.

If you're looking for further information on your financial wellbeing or lending options, please don't hesitate to get in touch or make an appointment.

Looking forward to hearing from you,

Fiona & Amy

Your Latest Lending FAQs

Wed, 29 May 2024 23:33:40 GMT

Answering questions we regularly get about lending.

With the recent changes in the housing industry we thought we'd answer some of your questions...

We recently asked our social media following what they'd like to know in our next newsletter. We've compiled these questions for you below alongside some of the ones our clients typically ask throughout the lending process.

Please note that these answers are typically general in nature and a full financial review is always recommended for tailored advice for your specific situation.

Questions Asked By You...

As a First Home Buyer, how much of a deposit do I need?
Can my parents act as a guarantor on my home loan?
What's the difference between Principal + Interest & Interest Only
Do the banks require a builders report?
What are the current LVR rules and when are these changing?
Is my Kainga Ora First Home Grant pre-approval still valid when they're

As a First Home Buyer, how much of a deposit do I need?

When looking to purchase an existing home, in most instances you'll be required to have a deposit that is 20% of the home’s value. If you have a deposit of less than 20%, you may still be eligible for a loan. There are certain options where you can apply for a home loan with as little deposit as 5% such as through the Kainga Ora First Home Loan Scheme. However, due to the Reserve Bank of NZ loan-to-value (LVR) restrictions a few more terms, conditions and fees may apply. To see whether your existing bank has options for you to borrow with less than 20% deposit, we recommend speaking to a mortgage advisor who can recommend your best options.

To learn more about applying for your first home loan, you can download our free guide by clicking the link below.

Can my parents act as a guarantor on my home loan?

Yes, your parents can act as a guarantor to secure your home loan when you wish to use their existing security equity. However, it 's important to note, both parties need to undergo a complete lending assessment to ensure if the worst were to happen, they could individually service the loan. It's always recommended that you seek legal advice and both parties are 100% certain to pursue this option.

What's the difference between Principal + Interest & Interest Only

Principal + Interest:

This is when you have a fixed repayment that goes on your home loan weekly/fortnightly/monthly. On top of this, you are accruing interest on the loan which you pay towards in your regular repayments as well.

Interest Only:

Interest only is simply when you're only paying the interest charges accruing on your home loan while not contributing to reducing the loan size.

Do the banks require a builders report?

A builders report is only required in certain situations when the lender needs confirmation that the property is compliant with building standards. For example, if you offered on a property with monolithic cladding, the bank may require a building report to ensure that the property has no history of leaking or any risk of leaking.

When applying with the Kainga Ora first home loan scheme, they may require you to get a builders report for any property you may purchase. This is their way of mitigating the risk of any future issues arising.

What are the current Loan-to-value-ratio (LVR) rules that lenders are assessing?

Currently in most circumstances, lenders will lend to 80% of the purchase price for an existing owner-occupied property. Some lenders will lend to 90% in some instances but this is dependent on the current lending services the lender can provide and whether you would meet the criteria.

When purchasing an investment property, lenders will lend to 65% of the purchase price, meaning you will need a 35% deposit as opposed to 20% with owner occupied. However, this rule has recently been changed and as of July 1st 2024, the lenders will now only require a 30% deposit instead, lending to 70% of the purchase price.*

This change goes hand-in-hand with the latest changes to Debt-to-income ratios, also effective from July 1st 2024. To learn more, have a read of our recent newsletter outlining the upcoming changes.

*Please note, these numbers are subject to serviceability and affordability. Please always seek advice from a professional that's tailored to your situation.

Is my Kainga Ora First Home Grant pre-approval still valid when they're no longer accepting applications?

Kainga Ora announced as of 1pm 22nd May 2024, they will no longer be accepting applications for the First Home Grant. If you had applied for the grant prior to this cut-off, your application will still be assessed. Once your application is pre-approved or if you already have a pre-approval in place, you have 6 months to purchase a home from the date of issuance before the pre-approval expires.

If you have any other questions regarding your lending, please don't hesitate to get in touch or make an appointment.

Looking forward to hearing from you,

Fiona & Amy

I’ve found my dream house...what's next?

Sun, 21 Apr 2024 22:18:28 GMT

Have you recently acquired a pre-approval for a home loan?

It's not just houses that come in all different shapes and sizes - the home buying process does as well.

This month we’re looking at the process that follows getting a pre-approval.

The Process Following Pre-Approval

So, you've just heard from your mortgage advisor that your loan with your lender has been approved. You're about to put an offer on a house but you're not quite sure how to put your best foot forward.

Here are a couple of tips we give our clients:

Always ask your mortgage advisor for any clauses you may need to add to your offer such as finance, solicitors’ approval, builders report, check council file etc, and what the best timeframe would be to get your approval unconditional from the lender.
The Sale & Purchase agreement may suggest you offer with a 10% deposit to be paid upon offer acceptance. This can be changed to any figure you’re comfortable with.
We always recommend putting an offer as an odd number as an advantage as it is likely any other offers will be round numbers like $500,000.
When stating your proposed settlement date please allow enough timeframe to meet deadlines such as withdrawal of Kiwisaver or rental agreement notice period etc.

My offer got accepted! What do I need to prepare for settlement?...

Once your offer is accepted, you’ll need to ensure you meet all the lenders requirements for your lending to go unconditional. These will be outlined on your pre-approval letter and may include:

Provide copy of Sale and Purchase agreement to be acceptable to the bank in all respects.
Registered Valuation report.
Confirmation of boarder income.
Closure of any short-term debt such as credit cards, personal loans or buy-now-pay-later accounts.

There may also be conditions that are subject to the house you’re looking to lend on as well. For example, the lender may request a building report to be completed if there is something in the house that they are unsure of and have marked as a risk. You will also need to get confirmation of full building insurance with no exclusions before going unconditional on a property. House insurance is a mandatory requirement of getting a home loan, no exceptions.

If you'd like to contact an advisor about your lending options, feel free to get in touch.

Looking forward to hearing from you,

Fiona & Amy

National introduces new interest deductibility rules

fiona@nzmortgageadvice.co.nz (Fiona De Barre) — Thu, 21 Mar 2024 01:07:58 GMT

Can you believe its already the end of the financial year?

There’s a lot going on in the industry at the moment, and to add to it, the National government has recently announced a change to the interest deductibility rules.

What is interest deductibility?

Interest deductibility is a term used for when interest paid on your home loan can be deducted from your rental income. This will result in paying less tax as your taxable income is lower without the interest being considered. Typically, this mainly applies to investors.

What are the new rules?

While the Labour party was in government, they removed the ability to offset your interest from your rental income, resulting in higher taxes as you were required to pay tax on your interest payments.

Current scenarios where interest deductibility applies:

· If your property is used for social housing or has an exemption it is 100% deductible.

· If you have a new build it is 100% deductible.

· If you bought your property before 27 ^th March 2021 it is 50% deductible.

· All properties purchased from 27 ^th March 2021 are not deductible.

The National government has announced that they will be reversing this rule, reinstating the interest to be deducted from your rental income.

New rules:

Starting this year, all investment properties are eligible for a 60% deduction in the 2023/24 financial year. From April 2024, 80% deduction applies and from April 2025, 100% will apply.

This is huge change which will see investors paying less tax on their properties while hopefully providing an ease to increasing rent prices with investors no longer fully reliant on rental income to combat the high interest rates. This could also a lot more prospective investors enter the market.

If you’re a prospective or existing investor and would like to discuss the new rules further or learn more about your options, feel free to get in touch.

Kind regards,

Fiona & Amy

Understanding The New Reserve Bank Rules

Thu, 29 Feb 2024 20:12:19 GMT

The Reserve Bank has recently announced upcoming changes to the Debt-to-Income (DTI) rules.

The Reserve Bank have advised that around mid 2024, they are looking to introduce new DTI rules for both prospective / current home owners & investors.

What Are The New Changes?

DTIs limit how much you can borrow based on your annual gross income. The Reserve Bank are looking to introduce a DTI limit of 6x your annual income for home owners, and 7x your annual income for investors. These rules won't apply to new builds but rather existing property.

Say you and your partner are first home buyers, earning a joint gross annual income of $150,000. Based on the proposed changes, you can purchase a property with maximum lending to the value of 6x your income.

$150,000 x 6 = $900,000* maximum lending.
*Subject to capability to serviceability and lender restrictions.

For investors, you are looking at a preliminary figure of 7x your annual gross income including any rental income you have. So if you were an investor with an owner-occupied home and one investment property, you would look at your estimated maximum lending based on the following equation:

Annual income $150,000 + Rental Income $31,200 (calculated at $600 per week) = $181,200 x 7 = $1,268,400

Please note, any debt you hold including existing loans, credit cards, student loans etc. the amount owing on these will be deducted from your maximum loan size.

So if the investors had an existing home loan of $500,000 in the example above, this would decrease their lending capability from $1,268,400 to $768,400.

They are also looking to decrease the deposit size for investors from 35% to 30% of the purchase price for existing properties. This will give investors an extra boost, as not only do they then need only 30% towards their purchase, but they also now have more lending on the other side of 70% from 65%.

So What Does This Mean For Your Lending?

It's important to note that these proposed changes will not affect your current lending.

Although you may be thinking "Oh no, this is going to limit my future lending significantly" this isn't quite the case. Currently, roughly less than 20% of those with existing loans in NZ have loans above the proposed DTI changes. The changes act as a barrier to avoid events similar to those a couple years ago where interest rates were low & house prices were high, encouraging more prospective buyers to apply for larger loans to accommodate for this state of the market. If this instance were to occur again, the DTI would provide a barrier to protect you in this instance from interest rates then rising.

If you'd like to understand your lending options now as well as once these new rules are introduced, feel free to get in touch for a no obligation chat.

Looking forward to hearing from you,

Fiona & Amy

Introducing Amy Bryant, Our Nelson-based Mortgage Advisor

Wed, 24 Jan 2024 01:05:19 GMT

We're super excited for Amy to be joining the NZMA team!

Amy has recently come on board as a mortgage advisor with NZ Mortgage Advice, based in Nelson, with the ability to help clients across NZ. This months newsletter will be giving you an introduction to Amy and an understanding of how she can assist with your lending requirements.

A Bit About Amy...

Amy has over three years experience in the mortgage industry, previously working for other businesses in both Hawkes Bay and Nelson.

With a clear vision for making homeownership accessible and stress-free, Amy brings a wealth of knowledge and expertise. She consistently ensures that each client receives personalized solutions tailored to their lending requirements.

Helping First Home Buyers reach their goals of home ownership is one of her favourite parts of the role.

Outside of work, Amy enjoys getting outdoors and spending time with her family and two dogs.

How Amy Can Help With Your Lending

Amy can help you with all your lending requirements from first home purchases to refinances. Here are some of the lending services Amy can assist you with:

First Home Loans
Residential Loans
Commercial Loans
Construction Loans
Bridging Finance
Debt Consolidation
Asset & Cashflow Funding
Personal Loans
Home Loan Topups
Fixed Rate Renewals
Investment Property Lending

Just to name a few!

To learn more about the lending services we provide, follow the button below.

If you'd like to contact Amy and discuss your lending options, feel free to get in touch.

Looking forward to hearing from you,

Fiona & Amy

Understanding Debt Consolidation

Thu, 21 Dec 2023 04:17:53 GMT

What you need to know about Debt Consolidation

It's that time again...Wishing you a great holiday period as we creep closer to 2024!

Each year, we send out a monthly newsletter with a topic that is at the front of peoples minds following the holiday season. We're going to break down debt consolidation.

What is Debt Consolidation?

Debt Consolidation is when you have multiple existing loans which you can combine into one loan with one interest rate so that you aren't paying off multiple loans at different interest rates.

In the best situation, debt consolidating results in having one loan at a lower interest rate so you are able to pay off the loan faster and save on potential interest costs.

Advantages

When consolidating, the repayments tend to end up being at a lower interest rate over a longer period. This results in smaller re-occurring payments.
A huge benefit is having all loans combined into one making your finances easier to manage with one easy payment.
Depending on the provider, there may be flexible repayment options and some providers may not charge any additional fees.

Disadvantages

Debt Consolidation may only be a short term fix should your financial situation change, leaving you unable to meet the repayments of the new loan.
There may be additional fees surrounding the process such as adding another set of establishment fees when consolidating the loan on top of the fees you paid initially on each loan.
If you choose to consolidate your loans through a company rather than the bank, they may charge you a higher interest rate.

If this has got you thinking about your options when it comes to your personal finances, please feel free to get in touch today and we can create a tailored plan that will be best suit your specific financial situation.

I look forward to hearing from you.

Fiona

What are your Contribution Options for a Home Loan Deposit?

Tue, 21 Nov 2023 22:21:10 GMT

Pulling together your deposit fund can seem overwhelming but it doesn't have to be!

There are lots of options that you can contribute towards your first deposit other than just savings. We thought we would give you a quick run through of some options that might help you get on your way to securing a house deposit.

What Does a House Deposit Look Like?

The general rule is that you're aiming for a deposit of 20% of the house value if possible. The bank will then lend to 80% of the property value which will make up your home loan. This is the basic rule for Loan to Value Ratio (LVR) that is used across the banks.

There are some instances where 20% deposit is not necessary when applying for a home loan as long as you are able to service the loan in your financial position.

The following situations may apply:

Lending at high LVR - the lender may lend up to 90% if you have a smaller deposit but are able to service a larger loan. In the current market this would need to be submitted to the lender as a 'live deal' which is when you have had your offer accepted on a house, subject to finance, before applying for your approval with a lender.
Apply through Kainga Ora First Home Loan Scheme - eligibility criteria applies.
Second tier lenders can be another option to consider. However, please note interest rates are likely to be higher and other terms, conditions and fees may apply.

Please note the application is also calculated on your ability to service a loan based on your financial position not only your deposit funds. Your financial position will still dictate your loan size regardless if you have more than 20% deposit.

Deposits - What Are Your Options?

There are many ways of securing a house deposit other than just your savings. For example, you may be eligible for a first home grant worth up to $10,000.

Personal Savings - Putting away a chunk of your income regularly not only takes you closer to a deposit, it also demonstrates to the bank that you have the commitment you’ll need for a home loan.
Keep track of your spending
Before you buy something, ask yourself ‘Do I really need this?’
Automate your savings so your money is out of your account before you get a chance to spend it.

Kiwisaver - You may be able to withdraw money from your Kiwisaver to buy your first house – you’ll need to fill out he paperwork with your provider and have the funds pre-approved for withdraw prior to offering on a house. If you don’t know what Kiwisaver provider you are with, you can call the Inland Revenue and they will be able to tell you.

First Home Grant - A first home grant can provide a lump sum of between $3000 and $10,000 to assist you into your first home. Eligible first home buyers can get up to $5000 each for an existing house or up to $10,000 each for a new build. To be eligible you’ll need to have been a member of Kiwisaver for at least three years and earn less than the maximum income levels. There are other criteria and house price caps that apply. Please note that regional house price caps will apply.

Gifted Funds - Parents can gift you a sum of money that helps make up any shortfall with your deposit funds. The bank will require a gifted letter to be provided

Guarantee's - Your family can provide a guarantee over your loan if you have little or no deposit. This allows them to use their equity without having to provide any money up front. However, if you fail to make a repayment your guarantor is then liable.

Our First Home Buyers guide also provides a thorough understanding on applying for your first home. You can download the guide by clicking the button below.

If you'd like to learn more about what you can do to prepare your loan deposit, feel free to get in touch.

Looking forward to hearing from you,

Fiona

Answering your Home Loan Questions

Thu, 26 Oct 2023 00:05:19 GMT

Answering questions we regularly get about lending.

I've been seeing a few questions recurring in industry discussions recently.

With the housing market a hot topic amongst the election and our current NZ economy, a lot of people are looking to learn more about their current or potential lending. I thought it may be beneficial to collate the questions I often get asked or see online and answer them here.

This advice is general in nature and a full financial review is always recommended for tailored advice for your specific situation.

Questions Asked By You...

How do I buy at auction?

Buying a house at auction in New Zealand is a straightforward process, but it can be competitive and fast-paced. Here are the steps to follow:

1. Research:

Research the property market and location where you want to buy. Determine your budget and what type of property you're looking for.
Attend other auctions as a spectator to get a feel for the process.

2. Pre-Auction Preparation:

Get your finances in order. You will need a 10% deposit on the day of the auction, and the rest within a specified timeframe.
Arrange unconditional approval for a mortgage if needed.
Engage a solicitor or conveyancer to review the auction agreement and provide advice.

3. Property Inspection:

Inspect the property. Attend open homes or arrange private viewings to assess the condition and suitability of the property.

4. Legal Due Diligence:

Review the auction documents, which should be available from the auctioneer or the real estate agent.
Check for any restrictions, covenants, or encumbrances on the property.
Ensure you understand the terms and conditions of the auction.

5. Attend the Auction:

Attend the auction at the specified time and location.
Bring identification and be ready to pay the deposit if you are the successful bidder.

6. Bidding:

When the auction begins, you can bid by raising your hand or calling out your bid.
Be aware of your budget and stick to it. The highest bidder wins the property.

7. Winning the Auction:

If you are the winning bidder, you will be required to sign the auction contract and provide the deposit.
The settlement date will be specified in the contract.

8. Unsold Properties:

If the property doesn't reach its reserve price, it may be passed in, and you can negotiate with the seller afterward.

9. Post-Auction Steps:

Complete the sale by paying the remaining purchase price on the specified settlement date.
Transfer ownership through legal channels with the help of your solicitor or conveyancer.

It's crucial to do your due diligence, both in terms of property research and understanding the auction process. Additionally, consider seeking professional advice from a real estate agent, solicitor, or conveyancer to ensure that you are making an informed decision and handling the transaction correctly.

Please note that the auction process can vary slightly in different regions of New Zealand, so it's a good idea to consult with local real estate professionals for specific guidance in your area.

Can I offer on two properties at once?

Making an offer on two properties when you only have financing approval for one can be risky and may not be advisable. Here are a few things to consider:

Financing Approval: Your financing approval is typically specific to a particular property. Lenders assess your ability to repay a loan based on various factors, including your income, credit score, and the specific property's value. If you make offers on two properties and your financing is only approved for one, you may not be able to secure the necessary funds for the second property.
Contingencies: Most real estate purchase contracts include contingencies that allow you to back out of the deal if you are unable to secure financing. However, if you're making offers on two properties, you'll need to be careful with the wording of these contingencies to ensure you have an "out" if your financing falls through for one of the properties.
Deposits: When you make an offer on a property, you typically need to provide a deposit to demonstrate your serious intent to purchase. If you make offers on two properties and then have to back out of one because of financing issues, you may risk losing the deposit for that property.
Seller Expectations: Sellers may not take your offer seriously if you don't have financing approval in place for both properties. They may opt for another buyer who has secured financing for their intended purchase.
Legal Implications: Depending on the specifics of your situation and local real estate laws, attempting to make offers on two properties with only one financing approval may have legal consequences or complications.

It's generally a better approach to have financing approval in place for each property you intend to make an offer on. Alternatively, you could prioritize one property and make an offer on it, secure financing approval, and, if that offer is accepted, then focus on the second property. If your circumstances change, you can always revisit the second property later.

It's crucial to consult with a real estate professional and your lender for guidance specific to your situation and local regulations. They can help you navigate the process effectively and ensure you make informed decisions.

I have lots of equity but the bank won't approve my finance...Why is this?

There could be several reasons why the bank is not approving your finance application despite having substantial equity. Here are some possible explanations:

Credit History: Your credit history plays a significant role in a bank's decision to approve a loan. If you have a history of late payments, defaults, or other negative marks on your credit report, it can make it challenging to secure financing.
Income and Affordability: Even if you have a lot of equity, the bank may be concerned about your ability to repay the loan. They typically assess your income and expenses to determine whether you can afford the loan payments.
Debt-to-Income Ratio: Banks use a debt-to-income ratio to assess your financial stability. If your existing debts are too high in relation to your income, it may raise concerns about your ability to manage additional debt.
Property Valuation: The bank may have a different valuation of your property than you do. If they believe your property is worth less than you claim, it can impact their willingness to lend against it.
Loan Purpose: The purpose of the loan can also affect approval. If you're seeking financing for a high-risk venture or an unusual project, the bank may be more cautious.
Lending Policies: Banks have their own lending policies and risk assessment criteria. Your application may not align with their specific requirements, even if you believe you meet general lending criteria.
Regulatory Changes: Banks operate under regulatory guidelines, and these guidelines can change over time. New regulations or changes in the banking industry could impact loan approval processes.
Documentation: Sometimes, a lack of proper documentation or errors in your application can lead to rejection. Make sure all your financial documents are in order and accurate.
Unstable Financial Situation: If your financial situation is unstable or uncertain, it can raise red flags for the bank. They want to ensure that borrowers have a stable source of income and financial security.
Bank-Specific Issues: It's also possible that there are issues specific to the bank itself, such as changes in their lending policies or internal issues that affect their ability to approve loans.

To address this situation, it's a good idea to contact your Mortgage advisor and ask for specific reasons for the rejection. You can work on improving those areas, whether it's improving your credit, reducing existing debt, providing additional documentation, or seeking financing from a different lender. In this situation, it's helpful to consult with a financial advisor who can provide guidance on how to enhance your eligibility for financing.

My credit score is poor due to an incident that occurred years ago...am I able to get a home loan?

In New Zealand, your ability to get a home loan with a poor credit score will depend on several factors, including the severity of your credit issues, the specific lender's policies, and your current financial situation. Here are some steps you can take to improve your chances of getting a home loan with a poor credit score:

Check Your Credit Report: Obtain a copy of your credit report from one or more of the credit reporting agencies in New Zealand, such as Equifax or Centrix. Review it carefully to ensure there are no errors or inaccuracies.
Address Outstanding Debts: If you have any outstanding debts, try to pay them off or negotiate with creditors to settle them. Reducing your existing debt can improve your credit score.
Build a Savings History: Saving for a deposit on your home and demonstrating financial responsibility can offset a poor credit history. Lenders may be more willing to work with you if you have a sizable deposit payment.
Find a Mortgage Advisor: Mortgage advisors are well-versed in working with various lenders and can help you find a lender that may be willing to work with your credit situation.
Consider Non-Bank Lenders: In some cases, non-bank lenders may be more flexible in lending to individuals with poor credit. Be aware that interest rates may be higher with non-bank lenders.
Document Your Finances: Be prepared to provide detailed financial information, such as bank statements, payslips, and IRD personal tax returns, to prove your ability to repay the loan.
Seek a Guarantor or Co-Borrower: If you have a family member with good credit, they may be willing to act as a guarantor or co-borrower, which can improve your chances of loan approval.
Improve Your Credit Score: Over time, work on rebuilding your credit by paying bills on time, reducing debt, and avoiding further negative marks on your credit report.
Be Patient: It may take some time to rebuild your credit and improve your financial situation. Be patient and persistent in your efforts.
Shop Around: Different lenders have different lending criteria. Don't be discouraged by one rejection; explore various lending options and see which one is the most accommodating for your situation.

While it's possible to obtain a home loan with a poor credit score, you may face higher interest rates and more stringent terms compared to those with better credit. It's essential to research your options, work on improving your credit, and consult with financial professionals to determine the best path forward for your specific situation.

What does the bank typically require for a live deal?

Typically the lender will request a valuation to be completed and often a building report depending on the type of property. There may be other conditions to your live deal that will be specific to your application.

Do banks lend to purchase a tiny home?

Banks in New Zealand, generally lend money to finance the purchase of homes, in some instance this does include tiny homes. However, the availability of financing for tiny homes may vary depending on several factors. Here are some things to consider:

Type of Tiny Home: Banks may be more willing to finance a tiny home if it meets certain standards and regulations. For example, a tiny home on wheels (THOW) might be considered more like a caravan or mobile home, and financing for these structures can be different from financing for traditional homes. When financing for a Tiny home the bank may lend against the land value only!
Location: The location of the tiny home could affect financing options. If it's on a piece of land you own, the bank may treat it differently than if it's on rented land or in a tiny home community.
Creditworthiness: Your credit history and financial situation will play a significant role in a bank's decision to lend to you. It's important to have a good credit score and financial stability.
Loan Amount: The size of the loan you need might also impact your financing options. Smaller loans can sometimes be more challenging to secure, as the bank may have minimum loan requirements.
Banks and Lenders: Different banks and lending institutions may have different policies and criteria for lending for tiny homes. It's a good idea to speak with a mortgage advisor to compare their offerings.
Regulations: Be aware of any local or national regulations that might impact the placement and financing of tiny homes.
Deposit: You will likely need to pay a deposit, and the amount required may vary from one lender to another.

It's essential to reach out to your Mortgage advisor to discuss your specific situation and get information about lenders policies regarding tiny homes. It always helpful to work with a mortgage advisor who can help you navigate the lending options available to you.

What are the costs for using a mortgage advisor?

In most cases, using a mortgage advisor is free to the customer as the advisor is remunerated by the bank upon drawdown of the loan. Some instances where the mortgage advisor may charge the customer a fee is if the customer decides to use a different mortgage advisor or go directly to the bank for their lending after their pre-approval has already been secured. Other instances where a fee may be charged as a on-off is if the following occurs:

There’s no commission: If you request that financial advice is provided, and the mortgage advisor does not receive a commission from the lender a one-off fee may be charged. Any such fee would be agreed and authorised by you in writing before the service was completed and would be based on an estimate of the time spent providing the advice.
Commission must be repaid: if you make certain changes to your loan, the lender can require the mortgage adviser to repay to them the commission the mortgage advisor received for your loan – this is called a ‘clawback’ and can be up to 100% of the commission. If this occurs, the mortgage advisor may charge you a one-off fee.
In the event that you use a mortgage advisory service and then instruct the mortgage advisor not to proceed with an approved application for the product being discussed, a one-off fee may be charged to cover the cost of the time.

If you have any other questions regarding your lending, please don't hesitate to get in touch or make an appointment.

Looking forward to hearing from you,

Fiona

Prospa: Supporting NZ Businesses

Mon, 25 Sep 2023 01:47:21 GMT

This month we're showcasing one of our lending partners for New Zealand's businesses - Prospa.

Prospa pride themselves in being a simple, stress free and seamless financial provider. They're all about supporting small businesses across NZ by providing a great depth of knowledge and understanding of small businesses needs.

Listening, learning, and evolving alongside their customers, Prospa has made a positive impact in the market and continue to help businesses across the country.

All About Prospa...

Prospa offers a range of business lending options to best suit the customer. They have an application process that is simple and straightforward with clear instructions of what's required. There fundamental guidelines are as follows:

Speed - Applications in under 10 minutes, quick decisions and funding possible in hours.
Flexibility - Make business happen with their range of lending products designed for what your business needs.
Support - Their dedicated Business Lending Specialists get to know you, and your business.
Confidence - Join thousands of small businesses who thrive with the support of Prospa.

Loan Options...

With their strong ideals and great expertise, Prospa have formulated three loan types to best suit businesses in New Zealand:

Prospa Small Business Loan
$5,000 up to $100,000 for unexpected expenses or a one-off purchase.
With the Small Business loan, you're able to borrow from $5,000 up to $100,000. Prospa offers a 24-hour processing time for applications, along with an indication of the fixed repayments. This loan also has flexible repayment terms of 3 – 36 months, with the freedom to pay out your loan early and save on interest. No upfront security is required in the form of assets for up to $150,000 in Prospa funding.

Prospa Plus Business Loan
Loans of $100,000 to $500,000 to invest in growth opportunities.
Borrow above $100K and up to $500,000 with a decision within 24 hours of your application submittion along with an indication of fixed repayments. There are no upfront credit checks for pre-approval on loans above $250,000. However, upfront asset security is required for loan applications above $150,000. Charge over the applying business entity(ies) will be registered on the Personal Property Securities Registry (PPSR). Prospa also offers early payout options for this loan.

Prospa Business Line of Credit
Ongoing, flexible access to funds up to $150,000 to help you stay on top of cash flow fluctuations.
Prospa offers a Line of Credit option for between $2,000 and $150,000 where customers can use and reuse the funds as required. You are only required to pay interest on the funds you use. There are also flexible terms with with an initial 24-month term with option to renew. No asset security is required upfront to access the Prospa funding for up to $150,000.

*Lending criteria and terms & conditions apply

If this has sparked your interest in applying for a business loan through Prospa, please feel free to get in touch to discuss your needs.

Looking forward to hearing from you,

Fiona

First Home Buyer Guide to Lending

Thu, 27 Jul 2023 21:19:02 GMT

It's so exciting to see more and more first home buyers entering the market!

Taking the first step in applying for a home loan can be daunting. You're unsure of the process and what your options are. That's where a mortgage advisor comes in! I'm here to help you through every step of the way, answering all your questions and getting you the best result for your situation!

And don't worry, if you're not a first home buyer but looking to purchase a home, this information is also handy for you!

Buying a home - What's the process?

When buying your first home, often you don't know where to start. That's why I've put together a simplified version of the step-by-step process of what to expect when working with a Mortgage Advisor.

Alongside this, I've created a guide filled with some practical information to help you navigate the home buying process. It explains the steps you can take to prepare to buy your first home, from gathering your deposit funds to presenting your financial situation as best as possible to the bank. You’ll also find out about the different ways to buy a house, different home loan options and the roles of all your professionals you’ll need along the way.

Please follow the link below to have a read.

If you'd like to learn more or start the home loan process, feel free to get in touch today and we can create a tailored plan that will be best suit your situation.

Looking forward to hearing from you.

Fiona

Which type of home loan is best?

Sun, 25 Jun 2023 21:16:44 GMT

Our latest newsletter goes through all your options when it comes to your home loan...

Often, my clients are unfamiliar with the different options they have for their home loan. An individuals financial situation is not a one size fits all and neither is the structure of your home loan!

Home loans - Your options...

With most types of home loans, you can choose either a fixed or a floating (or variable) interest rate. Revolving credit home loans and offsetting home loans have a floating interest rate.

Fixed interest rate – A fixed interest rate will not change during the period (term) of the fixed rate that you choose. At the end of your fixed interest rate term, you can either choose a new fixed rate from the rates available at the time, move to a floating rate or restructure your lending to adjust to your new needs.

Fixed rates may be lower than floating rates
You will have certainty of knowing exactly how much your repayments will be during the fixed term, making budgeting easier.
You might have to pay a break fee if you want to make extra repayments or pay off your loan fast than initially discussed at the start of the fixed interest rate term.

Floating interest rate – A floating interest rate may go up and down as interest rates in the wider market change. You can change to a fixed interest rate at any time, although some types of loans are only available with a floating interest rate.

You have the flexibility to make lump sum payments of any size at any time without penalty.
If interest rates go down, you can potentially pay off your loan faster by keeping your repayments at the same level.
As the rate is floating it may go higher than fixed-term rates
If the interest rate goes up, so will your repayments which could put a squeeze on your budget.

Revolving Credit – A revolving credit facility provides your home loan and everyday banking all in one account on a floating rate. When your salary is paid into your account it reduces what you owe on your loan – which means you pay less interest. Revolving home loans are best suited to people who are disciplined in their approach to money.

Offset Home Loan – An offset home loan gives you the ability to use the balance of your eligible transaction and savings accounts to offset against your floating home loan and only pay interest on the difference. This could save you thousands on your interest repayments and cut the years of your home loan. Not all banks offer an offset loan which means this will be important to discuss with your adviser when firming up your needs and requirements for your new home loan. An offset home loan is for you if:

You want to reduce the amount of interest you pay
You want to reduce the length of your loan
You can save as well as pay off your home loan
You’d like to keep your home loan and savings in separate accounts
Your comfortable with a floating rate knowing that interest rates could change.

If this has got you thinking about how you could restructure your loan or prepare for a future loan, feel free to get in touch today and we can create a tailored plan best suited to your situation.

I look forward to hearing from you.

Fiona

Special Offer for the 2023 Hawkes Bay Better Home & Living Show

Thu, 04 May 2023 22:18:10 GMT

I’m very excited to be exhibiting once again at this year’s Better Living Home and Garden Show 26th – 28th May 2023 at Hawkes Bay Pettigrew Green Arena.

Packed with hundreds of products and ideas for the home, the Better Home & Garden Shows will inform and inspire anyone who is a home and lifestyle enthusiast.

I’d love you to stop by and say Hi!

Special Offer!

We're super excited to have a great offer to share with the NZ Mortgage Advice community. The Better Home & Living Show has kindly provided us with a 2 for 1 voucher for adults to use when attending the upcoming event.

Simply present the attached ticket on your phone or printed at the ticket box.
Adults will gain entry to the Show for just $5.
Please note the discount is not valid for gold Friday.

To download your ticket please click here!

What is EV loan?

Sun, 23 Apr 2023 20:33:54 GMT

Here's your latest newsletter from NZ Mortgage Advice where we dive into the sustainable energy loans that some lenders are currently offering.

You may not be aware however, the NZ main banks have recently introduced special offers for customers to take out a loan for sustainable and energy efficient purchases such as electric vehicles, home insolation, and solar energy.

Sustainable Energy Loans - The what and why...

Lenders are running an offer as a part of the countries ambition for a more sustainable future. The offer is lender-specific but all allow for customers to take out a loan covering some costs for purchases on sustainable expenditure.

Examples of Sustainable Expenditure...*

Home insulation
Heat pumps
double glazing
Ventilation
Wood burners
Solar power systems and batteries
Electric/Hybrid vehicles (and/or chargers)
E-bikes
Small-scale hydro, wind energy or geothermal resources that is for sale to the general public and have at least 10 year warranty.
Sustainable water upgrades

*Terms & conditions apply specific to individual lenders. Purchases must be made within lenders required timeframe.

What the banks are offering...

Westpac:

6.99% p.a. on up to $50,000 for for a new or used vehicle. Interest rate is subject to change.
Stand loan terms from 6 months to 5 years.
Equity - Minimum 20% owner occupied and 40% investment property.
New or current customers (landlords or homeowners).
Must meet standard eligibility and lending criteria and be able to repay the loan in full within five years.

ASB:

Current offer is 1%p.a. loan of up to $80,000 fixed for 3 years.
You must be an existing ASB home loan customer.
Equity required is a minimum of 20% for owner-occupied properties and 40% for investment properties.
Only available for eligible improvements and purchases, ASB's lending criteria and terms apply.

ANZ:

Top up a current ANZ home loan for up to $80,000 at a fixed rate of 1% over 3 years - once the rate expires, you can choose to either fix or float.
Not available for business purposes or for new builds (until the new build lending is fully drawn).
New customers can apply for ANZ Home Loan and Good Energy Loan top up at the same time.
ANZ Good Energy Home Loan top ups are not available for upgrades purchased prior to 4 July 2022.
ANZ's lending criteria and terms apply.

BNZ:

Current offer is 1%p.a. loan fixed for 3 years to the maximum amount of $80,000 (minimum $5,000).
Available for new and existing customers.
Maximum LVR for this offer is 80% for owner occupied and 60% for Investor properties.
Lending to be documented up to a 30-year term and as a 'Classic Home Loan" fixed for a maximum of 3 years (standard rates apply thereafter).
Not eligible for business purposes.
An establishment fee of $150 may apply for new customers.
Normal home loan policy applies.

Kiwibank:

If you borrow more than $5,000, Kiwibank will contribute up to $2,000 over four years towards the cost of the system and $400 at the end of each of the following years.
If an existing Kiwibank Home Loan customer, the home loan top-up fee will be waived.
The sustainable energy loan is a variable rate home loan. The minimum loan term is seven years and the maximum term is 10 years. It's not available with an offset home loan or a revolving home loan.
Usual home loan lending criteria and terms apply.

If this has got you thinking about your options when it comes to getting a sustainable energy loan, please feel free to get in touch today and we can create a tailored plan that will be best suit your situation.

I look forward to hearing from you.

Fiona

Refer a Friend!

Mon, 10 Apr 2023 22:26:06 GMT

As we get closer & closer to winter, I thought it would be a good opportunity for a pick-me up!

I firstly want to thank you all for your continued support and use of NZ Mortgage Advice's services. I always find my role so rewarding and being able to help people into new homes and with their lending requirements is such a great feeling.

For the remainder of the year, I'd like to give back to those who continue to support NZ Mortgage Advice.

That's why I'm offering a referral reward for any current or existing client who refers NZ Mortgage Advice onto a friend!

In exchange for kindly passing on your experience, simply mention this newsletter and receive a referral reward of $250, payable upon a new home loan draw down before 31/12/2023*

*Lending criteria and terms & conditions apply.

If you have any questions regarding the offer, or if you would like to discuss your own lending requirements, give me a call and let’s talk home loan solutions!

Once again, thank you for the continued support & I look forward to hearing from you soon!

Fiona

The latest market update on New Zealand interest rates

Sun, 19 Mar 2023 19:50:45 GMT

For our latest newsletter, we wanted to touch on the hot topic of interest rates...

Interest rates are continuing to play on both home owner and potential buyers minds. There's so much happening in our current market so it's important to try and keep up with the latest bank changes to ensure you get the best outcome for your situation.

Interest rates - Our current market situation...

As discussed in Tony Alexanders' latest economist market update, the Silicon Valley Bank (SVB) collapse has had some flow-on effects to New Zealand's interest rates. We've just observed a decrease in the wholesale interest rates for the first time in a long time. For example, the one year swap rate at which banks borrow fixed to lend fixed has decreased from 5.65% to around 5.3% with the three-year swap rate decreasing from 5.25% to 4.75%.

Research suggests it may be a good idea to fix your interest rate for one year based on the current market. It also may be worth looking at least fixing a portion of your loan for two years. This is based on the idea that inflation may not ease as soon as we hope.

The next NZ cash rate review is on April 5th. It is likely that the reserve bank will once again lift the cash rate between 0.25-0.5%.

This information is based on current world events and theories and is no way intended for full financial advise. To fully understand your options and get an understanding of the market, please contact me today to go over a tailored plan that best suits your financial needs.

Q & A - Your questions answered by a mortgage advisor.

Q: What is the best term to fix my home loan for?
A: This depends on your individual financial situation and is always recommended you speak to an financial adviser around how your home loan fixed period relates to your financial goals and how you can structure your home loan to align with your future goal outcomes.

Q: What are my best options to ease my home loan repayments?
A: Here are some examples of ways you can ease your home loan repayments

Extend the term of your home loan.
Switch to an interest-only home loan option (if eligible).
Change your repayment frequency from monthly to fortnightly.
Refinance to another lender.
Offset your home loan against savings held, with a lender that offers this option of home loan.
Use any spare funds to reduce your home loan or make extra repayments as you can.
Request a home loan repayment holiday (if eligible).

*Before making any changes to your home loan it’s important to seek financial advice.

Q: What are the advantages of fixing a home loan?
A: The main advantage of a fixed rate is home loan repayment certainty. For a set period of time, you know exactly what your home loan repayments will be. This makes budgeting easier and you won’t be affected if interest rates rise within your set fixed interest rate period.

Q: What are the disadvantages?
A: The downside of a fixed home loan is you can’t opt out of your fixed term unless you pay a break fee, which could negate any potential savings. This also means you’ll miss out if interest rates drop within your fixed home loan interest rate period. In addition, some banks charge a fee if you make extra repayments during your home loan fixed rate period.

Q: Is it better to get a fixed or variable mortgage now?
A: This depends on your individual financial situation and is always recommended you speak to a financial adviser expert around how your home loan structure relates to your financial goals. Everyone’s financial situation differs which means there’s no one size fits all approach.

Q: How can I pay my home loan off faster?
A: Here’s 6 ways to pay off your home loan faster

Increase your home loan repayment amounts.
Structure your home loan with flexibility in mind.
Switch repayments from monthly to fortnightly.
Make lump sum payments as you can.
Make a portion of your home loan floating or on a revolving credit facility and aim to repay this amount as quickly as you can.
If your interest rate goes down, don’t reduce your repayments with it.

Q: Is refinancing my home loan an option?
A: Refinancing is a common option and makes sense if you’re looking to secure the best options possible for your home loan and to align with your financial goals. This could save you thousands in interest with an aim to pay off your home loan more quickly. It’s important to always look at what fees may be involved when making your decision to refinance.

Want to learn more about your options when it comes to a home loan and getting the best interest rate? Feel free to get in touch today and we can create a tailored plan best suited to your situation.

I look forward to hearing from you.

Fiona

Support during challenging times

Sun, 19 Feb 2023 20:03:47 GMT

Support during challenging times

We want to firstly express our deepest sympathy towards those affected by Cyclone Gabrielle across the country. Our thoughts are with you and your families at this very challenging time.

We are so devastated by the recent events across the North Island caused by Cyclone Gabrielle. My local community, like many, has been greatly impacted. We are beyond grateful to have our home and family safe, and are so thankful for the support we've received.

In these trying times, we want to make sure that you are getting as much financial support as possible. If I can help in any way please do not hesitate to reach out.

Regarding the flood relief options available by your banks for both personal and business customers, please read the information below which each main bank has issued. I am here to also provide any support and advice you may need with liaising with your banks regarding the flood relief support for your home loans. Please note that some of the support provided by the banks is a grant so worth investigating.

I have also attached some information below on how you can support our community at this time.

Cyclone Gabrielle Business and Personal Financial support details are noted below:

Westpac:

https://www.westpac.co.nz/about-us/upper-north-island-flooding/?fbclid=IwAR3f_MrfPBV_d-piicasfAm7D71SRPU3egrB0oUrlg3PGEM01hZwr4eZCtE

ASB:

https://www.asb.co.nz/

ANZ:

https://www.anz.co.nz/personal/

BNZ:

https://www.bnz.co.nz/personal-banking/home-loans?gclsrc=aw.ds&&gclid=Cj0KCQjwpompBhDZARIsAFD_Fp-ETUzJGLAozQL2sTIfeKZDYndHbsW7mEqgEjAOElBjOZZG3EUvx_MaAqnrEALw_wcB&gclsrc=aw.ds

Kiwibank:

https://www.kiwibank.co.nz/personal-banking/

SBS:

Please call 0800 727 2265

For more information about support from your bank, please get in contact with me or your bank directly.

How you can support your community...

We wish to express a big thank you to all those, both officials and volunteers, who have been helping in any way they can over the last week with the devastation caused by Cyclone Gabrielle. The support in the community has been incredibly heart warming and makes such a difference.

Helpful resources...

MSFT Productions - This organisation are working to link those willing to volunteer their time to help, with those desperately needing assistance. This website also allows volunteers to sign up to help out in the community with others able to ask directly for assistance.
Red Cross New Zealand Disaster Fund - asking for monetary donations to go towards the relief efforts.
Mayoral Relief Fund - Working to provide financial support to affected communities.
Hapori Māori fundraising groups - a collection of fundraisers for Hapori Māori across Aotearoa.
Support for affected Animals - providing shelter and supplies to animals who have been found and cared for.
HUHA
SPCA Hawkes Bay
Animal Evac New Zealand

Givealittle fundraisers - Stuff have an overall fundraiser for support towards Red Cross and the Mayoral Relief Fund. There are also many smaller fundraisers for individual families/businesses.

Sending all my love from my family to yours,

Fiona

Debt Consolidation

Thu, 19 Jan 2023 20:16:04 GMT

Debt consolidation

We thought we'd kickstart the year with a topic that might be hot on your minds after the holiday season. This months newsletter is all about debt consolidation.

Debt Consolidation - So what is it?

Advantages

When consolidating, the repayments tend to end up being at a lower interest rate over a longer period. This results in smaller re-occurring payments.
A huge benefit is having all loans combined into one making your finances easier to manage with one easy payment.
Depending on the provider, there may be flexible repayment options and some providers may not charge any additional fees.

Disadvantages

Debt Consolidation may only be a short term fix should your financial situation change, leaving you unable to meet the repayments of the new loan.
There may be additional fees surrounding the process such as adding another set of establishment fees when consolidating the loan on top of the fees you paid initially on each loan.
If you choose to consolidate your loans through a company rather than the bank, they may charge you a higher interest rate.

Find out more about debt consolidation.

nz-mortgage-advice

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Supporting NZ businesses with Prospa

We're proud to work with Prospa, a company providing lending to local businesses across NZ.

All About Prospa...

Loan Options...

Refer a Friend! - Limited Time Offer

We wanted to take a moment to say a big thank you for your ongoing support of NZ Mortgage Advice. ﻿

Clean Energy Loan Options

If you're looking to make some sustainable upgrades to your home, your lender may have a lending option for you that isn't going to cost you lots in interest...

Sustainable product options

What are lenders offering?

Buying a property using self-employed income

Purchasing an Investment Property with Existing Equity

Building wealth through property investment is a goal for many who are thinking long term about their retirement.

A tip for First Home Buyers

A positive outcome for a recent first home buyer...

Refix, restructure or refinance? How to ensure your home loan continues to work for you.

Often clients think that once settlement has been completed, they set and forget about their home loan for the next 30 years.

How much deposit do you need for an investment property in NZ?

The process to buying an investment property is fairly similar to buying an owner-occupied property. One of the clear differences between these lending processes is the required deposit.

What are your Deposit Options?

What are your deposit options when it comes to buying your first home? Lots of people may think that if you don’t have enough savings, you won’t have a big enough deposit for your home loan. This isn’t quite true!

Preparing your Home Loan Application

Preparing your home loan application can be a straightforward process with the right tools and a mortgage adviser by your side.

Common Mistakes When Buying a Home

Buying your first home can be both an exciting and equally stressful experience...

Not understanding lending terms and the steps to buying a home.

Not considering your long-term goals and ambitions.

Not using a mortgage advisor.

Not getting a pre-approval prior to offering on a property.

Getting your heart set on a property.

Not completing your due diligence

Stretching your budget too thin without considering unexpected costs.

Structuring your lending with little market analysis.

Let's Talk About Interest Rates

The last five years have been extraordinary to witness as the Reserve Bank has managed interest rates while trying to minimise the economic impacts of world events.

What Are House Prices And Interest Rates Doing?

Tips on Decreasing the Length of your Home Loan

The moment your first home loan payment is deducted from your bank account, I bet you think "Wow, is that really going to happen for the next 30 years?"

Tricks That Will Decrease Your Loan Term:

Did You Know That We Help You With All Types Of Lending Not Only Residential Home Loans?

We spend a lot of time discussing home loans but did you know we also assist with other lending options as well? ﻿

What Lending Can We Help You With?

Case Studies: Clients We've Helped With Non-Residential Lending

Case Study 1: Commercial Lending

Case Study 2: Debt Consolidation

Helping Offshore Kiwi's Buy In New Zealand

This month, we're looking at the options for Kiwi's living overseas when they want to buy property in New Zealand...

I live overseas but wish to buy a home in New Zealand? How is this possible?

Scaling your income:

Financial Tools We Love

We thought we'd share some of our favourite tools we use for developing our understanding of the financial industry and housing market...

Your Latest Lending FAQs

Answering questions we regularly get about lending.

With the recent changes in the housing industry we thought we'd answer some of your questions...

Questions Asked By You...

As a First Home Buyer, how much of a deposit do I need?

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Can my parents act as a guarantor on my home loan?

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What's the difference between Principal + Interest & Interest Only

Do the banks require a builders report?

What are the current Loan-to-value-ratio (LVR) rules that lenders are assessing?

Is my Kainga Ora First Home Grant pre-approval still valid when they're no longer accepting applications?

I’ve found my dream house...what's next?

Have you recently acquired a pre-approval for a home loan?

The Process Following Pre-Approval

My offer got accepted! What do I need to prepare for settlement?...

National introduces new interest deductibility rules

Can you believe its already the end of the financial year?

What is interest deductibility?

What are the new rules?

Understanding The New Reserve Bank Rules

New Granny Flat Rules in New Zealand — What Property Owners Need to Know in 2026

As of January 15th, 2026, New Zealand property owners are able to build small, standalone secondary dwellings — or 'granny flats'— without building consent in many circumstances.

We wanted to take a moment to say a big thank you for your ongoing support of NZ Mortgage Advice.

We spend a lot of time discussing home loans but did you know we also assist with other lending options as well?

So What Does This Mean For Your Lending?