Your First Home Loan
We understand what a scary yet exciting step buying your first home can be, so we aim to make it as easy and fun as can be for you to get the smartest deal!
We’ll help with all the key questions buzzing around your head like:
• How much can I spend on my house?
• How much can I borrow and how do I get the best deal?
• What deposit will I need?
• What do I need to do next?
And the best news is we help you at every step, typically with no cost to you, as the banks pay us commission on settlement drawdown of your loan.
So let’s get started :
1. Understand your situation
2. Pre Approval of your loan (conditonal)
3. Loan Approval
4. Purchase your property
5. Structure (Loan/deal/other)
6. Regular Review
1. Understanding your situation
When you contact us we chat about what your situation is and what your individual requirements are to understand your specific situation first.
To then provide a free appraisal we need some details from you. We call this a Fact Find.
What information will we require from you?
At the start we will need to gather certain supporting documents and information from you in order to analyse your situation to then recommend how we can help you. This includes:
Proof of Annual Income:
Salary or Wage Earner
• Latest 4 (consecutive) payslips, and
• 2 years’ income assessment from IRD (if income is not stable due to overtime or inconsistent hours worked)
• Copy of your employment contract (if you have been employed for less than 3 months)
• The last 2 years full financial statements prepared by an accountant and a recent income assessment from IRD
• Bank Statements showing Rental Income deposits for last 3 months
• and/or Tenancy agreement(s), signed by both tenant and landlord or a rent appraisal if its a new investment property you have in mind
Security details for the home you're interested in:
• Address details
1. Passport (Proof of residency)
2. Driver’s Licence
3. Utility Bill (To confirm address)
4. Bank account, loans, credit cards, hire purchase facilities.
5. Most recent 90 days main bank transaction statements
6. Most recent 90 days personal loan statements (if any)
7. Most recent 90 days credit card(s)/store card(s)/HP(s) or Buy Now Pay Later credit statements (if any)
2. Pre-Approval of your loan
We then use a system to analyse your information, to assess if you meet a selection of key banks/Mortgage providers criteria.
We organise a conditional ‘Pre-Approval’ to give you a guideline as to what price range you can buy a home in.
At this stage you can look for a home and you are under no obligation to use this conditional Pre-Approval or the particular bank which gave it. It does sped up the process once you’ve found a house you like. However, it doesn’t allow you to go ahead and purchase that house, you still need specific approval for that house. We help you with all this to make it easy for you.
Please note: If the actual purchase price is lower than the pre-approved amount, the bank will only lend a % of the purchase price (not the exact pre-approval dollar amount).
What deposit will I need?
To get the best deal and rates from Banks without paying a default fee (Low Equity Fee) typically you need to have 20% of your own equity (20% deposit).
Equity can include:
• Genuine cash savings
• Cash Gifts from relatives or friends (supported by an unencumbered gifting letter)
• Kiwisaver savings (assuming withdrawal eligibility)
• Family loan
• Sale of car or similar asset
Also, there are a number of government grants you can apply for to boost your deposit. We can help you understand what’s available and your eligibility.
If you are a KiwiSaver member there is a HomeStart grant
You must meet these criteria:
• Have spent three years regularly contributing to KiwiSaver (doen't need to be consecutive, but must be at least the minimum allowable percentage of your total income)
• Be 18 years of age or over
• Be purchasing an existing house or buying land and building your first home on it within 12 months and agree to live in your home for at least 6 months
• Have a household income (before tax) of less than $95,000 per year (for one person), or less than $150,000 per year (for two or more people)
• Have a deposit that is 5% or more of the purchase price, including the addition of the grant
• The property must also be below the purchase price cap criteria set by region - $625,000 for existing homes in Auckland or $700,000 for new builds
3. Loan Approval
With your agreement, we then approach the lender of choice to apply for a Bank Loan Offer. Once the banks offer is received, we notify you and if you agree, we approve in principle on your behalf and negotiate discounted rates and cash contributions.
Once you accept these, we then develop a suggested loan structure to discuss and agree with you.
Thinking of building your home?
A land and construction loan provides funding for new build or extensive renovations in a way that means you have the lowest possible repayments during the construction phase. Generally this entails an interest-only facility with a lower variable interest rate during the construction period, then it reverts to a standard home loan.
If you’re renting while your home’s being built, we can organise that the interest payment on your loan is capitalized. This means you won’t have to pay both rent and interest at the same time. The interest gets added to your Mortgage loan and once the build is completed, you then begin repaying the loan and accrued interest.
4. Purchase your property
Your first home may not be your dream home, but it’s often an affordable first step on the property ladder. Real estate websites are a good place to find out how much properties are worth in different areas.
Consider things like:
• Is the suburb appealing and offers future growth potential?
• Is the house close to public transport routes?
• Are there shops and schools within walking distance?
• Does the suburb have a strong rental market?
Once you have a particular home in mind and the bank loan offer is accepted by, we are nearly there!
5. Structure - the all-important details behind the words “home loan”
We work on your behalf to apply for your loan and once approved, we work to optimize your loan structure, loan and fixed term, interest rates, negotiate a cash contribution and help make the process as easy as possible for you. This may include recommending solicitors, registered valuers or accountants as necessary. We will work with your accountant and/or solicitor to ensure all your advisers are aligned and working in your best interest.
Settlement day arrives and you can jump for joy, feeling proud of what you’ve just accomplished!
6. Review – we want to keep helping you on an ongoing basis to reach your goal of paying the loan off faster
We know things don’t stand still in your life, your situation or priorities may well change. As we work with you to teach, inspire and help you get ahead, it’s important to us that we stay in touch and connect at least once a year to evaluate whether your structure still best suits your needs.