Common Mortgage Frequently Asked Questions (FAQ) Answered | KiwiMortgages
Mortgage Questions
1. Why should I use a Mortgage Broker?
The mortgage brokers provide their services free of cost. They deal with different lenders and have the ability to provide the options most suited to your circumstances. Experienced brokers like Kiwi Mortgages are able to provide you guidance and professional service in more complex transactions, like construction loans, or commercial loans etc.
2. Is there any fee for using Kiwi Mortgages services?
No, our services are free.
3. Do you provide the same home loans as the banks?
The products and service that you get is the same as the banks would offer directly and will also be at the same terms. In fact, due to our negotiating skills, the loan terms that you can potentially get in most instances is only better and structured more suited to your own individual situation, if arranged through us.
Read This – Whether to go to Bank or Mortgage Adviser ?
4. What is your best interest rate?
In most cases, it is seen that people like to fix the interest rate on their loan for certain period like 1,2,3 years or more, so it gives more certainty to their household budget, but in some situations, it may be more advisable to have the loan on floating interest rates or a combination of both. It all depends on your situation, the analysis of which we can help with. In New Zealand, currently the banks are offering the historical lowest interest rates, ever seen in this country.
5. What documentation is required to get a mortgage?
Again, it depends on your individual situation but at a very high level, the banks require documents to prove your income and your deposit that you propose to contribute, together with your bank statements to verify your personal expenses pattern and also your account conduct. The banks also require to know of your current assets and liabilities.
6. Will my interest rate change?
The fixed interest rates do not change until the period for which they have been fixed expires and then you again have the ability to re-fix them. The floating rates can change any time.
7. Should my mortgage be fixed or variable?
As per “4” above.
8. How much money do I need to buy a home?
Enough to complete the purchase. Typically, the banks require you to put in some contribution from your side towards the purchase.
9. How long does it take to get a Mortgage?
At Kiwi Mortgages, we normally get you an answer within a week but can arrange the loan even more urgently when the situation so demands, like the urgent auctions etc.
10. How much can I borrow?
You would require to borrow the purchase price of the house minus the deposit from your side but whether or not the banks will approve your lending depends upon your income. Importantly enough, it also depends a great deal on how the application is presented to the lender, which is where experienced broker such as Kiwi Mortgages can be of immense help.
Read This – What does a Mortgage Broker do?
First Home Buyer
1. Is there any Mortgages available for a First Time Home Buyer? (How much can I afford to borrow?)
The banks in NZ offer home loans at more lenient terms to first home buyers, so far as borrowers’ contribution is concerned. At Kiwi Mortgages, we can advise how much you can borrow with different banks in the initial meeting and can take you to the bank which will likely offer the most lending and most favourable terms
2. How much do I need for a deposit?
Normally, the banks require minimum of 20% deposit, but we can arrange loans at even 5-10% deposit if you are purchasing the house to live in there. A minimum of 30% deposit for an investment property. Normally a deposit of 35% will be required as a minimum for commercial properties but it can vary depending on the particular situation. Talk to us
3. Can I access the First Home Owners Grant?
You can be eligible for the home start grant as per below:
a- $1,000 for each completed year of kiwi saver membership, subject to a maximum of $5,000, if you are purchasing an old existing home
b- $2,000 for each completed year of kiwi saver membership, subject to a maximum of $10,000, if you are purchasing a brand-new home
c- And provided you meet the following conditions:
(i) – You have been contributing to kiwi saver for a minimum of three years
(ii) – You are purchasing the house for living in there and not for renting out
(iii) – Individual income no more than $85k p.a. and household income no more than $130k
(iv) – The maximum purchase price should not exceed $600k for old house and $650k for brand new house if purchasing in Auckland. There are limits for other parts of the country – talk to us for more information.
Refinance Mortgage
1. How much money can I save by refinancing?
Depending on each individual situation, our customers have been able to save thousands of dollars by restructuring or refinancing through us.
2. How much money can I save by consolidating my debts?
Typically, the loans not secured by your house are at a very high interest rate, sometimes as high as 20% or more. The banks are offering around 3.55% p.a. these days (This rate is at 7th Sep 2019 and interest rates offerings change all the time) and with a non-mortgage debt of say $50k at an average interest rate of say 15% p.a., you could potentially save about $5,000 to $6,000.