The dramatic increase in house prices in the main centres in New Zealand has caused a reaction in government circles whereby all residential borrowers of mortgages need to provide a 20% deposit. This has indeed had a dampening effect on the house market, as has the 40% deposit requirement all property investors. Why not take a look at the first-time homebuyer mistakes to avoid and make sure you don’t do them.
However this has had a bad effect on first time buyers who are simply unable to accumulate the 20% deposit. The government have provided a solution in the form of the welcome home package which banks can offer and which is under written by the housing department. This package only requires 18% deposit for the mortgage, but the mortgages limited to around $500,000, and those qualifying for the mortgage must have a combined income less than $130,000 for a couple or $85,000 for an individual.
Nevertheless a large number of first time buyers qualify under these rules, but in many cases they need good mortgage brokers in Lower Hutt to also help them qualify for the bank loan. All banks are very strict about the quality of client they take onboard for a mortgage, and they will want a good sound credit check plus they want to know that the client is a good stable job and also has a good savings history.
Good mortgage brokers Upper Hutt will be able to see quickly whether a client is going to be a shoe in for a mortgage with a main Bank, or whether the client is going to need some assistance in order to present themselves better. If the mortgage broker can see that the client is going to be easy to serve, then they will obviously be really happy and can make things happen very quickly for the client. If the mortgage broker realises that there is a potential problem, then if they are smart they will go out of their way to help the client get around the problem, because in the end if the broker can help a client qualify for a mortgage then the broker gets paid.
A good broker will be able to offer sound financial advice to the first time buyer, and this will be based around what level of debt is affordable, and what level of debt is attainable if the clients were to really put their mind to it. A particular problem for first time buyers as if the main owner at self-employed, as Banks generally do not like self employed people.
This is unfortunate, but a good mortgage broker will help the couple build a savings and employment record that will work with a bank, and this might simply mean that the non working partner gets a temporary job for a few months. A self-employed person could be in an excellent situation in regard to paying down a mortgage, but if the bank doesn’t want to learn to them then they have a real problem.