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Should You Fix for 6 or 12 Months After the Latest OCR Cut?

The Reserve Bank of New Zealand’s recent decision to cut the Official Cash Rate (OCR) by 0.50% has changed the game for borrowers. With more cuts predicted, many are left wondering: should you fix your mortgage for six months or 12 months, and what could that decision mean for your finances in 2025 and beyond?When the OCR drops, mortgage rates generally follow, making borrowing more affordable. This is encouraging for homeowners and prospective buyers alike.But it also presents a choice: do yo...

Connecting People Through a Community

The Junior Community Rugby Festivals provides a one day festival across six regions  throughout New Zealand. On Sunday 14th August we held our 5th Junior Community Rugby Festival at Swarbrick Park, Frankton, Waikato. They had a massive 111 teams participating from the ages 6-11 years....

Low Equity Margins & Premiums Explained: What You Need to Know

When you're in the process of securing a home loan, particularly if you have less than a 20% deposit, you'll likely encounter terms like Low Equity Margins (LEMs) and Low Equity Premiums (LEPs). These additional fees are important to understand, as they affect the overall cost of your mortgage and how much you’ll be paying over time. In this article, we’ll break down what LEMs and LEPs are, how they work, and what you need to consider when they apply to your mortgage....

How to Navigate Interest Rate Fixing in August 2024

As we navigate the ever-changing landscape of mortgage interest rates in August 2024, many homeowners are left wondering: What should I do with my interest rate fixed period? With recent drops in the Official Cash Rate (OCR) and subsequent rate adjustments by banks, it can be challenging to determine the best course of action. This guide aims to break down the key considerations you should keep in mind when deciding how to fix your mortgage rate in the current market....

What Does a Mortgage Advisor Do? A Comprehensive Guide

Navigating the home buying process or securing a loan can be complex and overwhelming, especially with the variety of options and products available. This is where a mortgage advisor comes in—a professional who guides you through the process, ensures you get the best deal from lenders, and helps structure your loan to align with your financial goals. But what exactly does a mortgage advisor do, and why should you consider using one? Here’s a comprehensive guide to understanding the role and ...

Should You Pay Off Your Mortgage Early? Exploring the Pros and Cons

Paying off your mortgage early is a common financial goal for many homeowners. The idea of being mortgage-free is undeniably appealing, offering freedom from monthly payments and the flexibility to use your income in other ways. However, the decision to pay off your mortgage as quickly as possible isn’t always straightforward and depends heavily on your broader financial objectives. Here, we’ll explore the pros and cons of early mortgage repayment and discuss alternative strategies that migh...

Exploring Joint Ownership: Buying a Home with Siblings, Family, or Friends

The traditional approach to buying a home has often been to purchase it alone or with a partner. However, with changing financial landscapes and diverse living arrangements, many people are exploring joint ownership as a viable option. Joint ownership can involve buying a property with siblings, extended family members, or even friends. While this can offer significant benefits, it’s crucial to understand the associated risks and rewards. Here’s a detailed look at joint ownership and how it ...

Understanding Break Fees in Your Home Loan

When dealing with mortgages, it’s essential to understand the potential costs that can arise if you need to change your loan terms. Two significant fees that often catch borrowers by surprise are break fees and non-utilization recovery costs. These fees can have a substantial impact on your finances, especially if market conditions change or your personal circumstances evolve. Here, we’ll explore what these fees are, when they apply, and how to plan your mortgage to avoid unexpected costs....

Key Considerations When Refixing Your Mortgage

Refixing your mortgage can be a crucial step in managing your financial health, especially in a fluctuating market. As interest rates shift and personal circumstances evolve, it’s essential to ensure that your mortgage terms align with your current and future financial goals. Here are some key considerations to keep in mind when deciding to refix your mortgage....

Fixed Rates vs. Floating Rates: Choosing the Right Mortgage Option for You

Fixed-rate mortgages involve entering into an agreement with your lender—typically a bank—where you commit to paying a set interest rate over a specified period. In New Zealand, you can typically fix your mortgage rate for periods ranging from 6 months to 5 years, with various increments like 12, 18, 24, 36, 48, and 60 months also available.The attractiveness of fixed rates often depends on the economic climate. For example, as of June 2024, shorter-term rates (such as 6 and 12 months) are h...

The Pros and Cons of Consolidating Debt Into Your Home Loan

Debt consolidation involves combining multiple debts into a single loan, typically your mortgage. This process can simplify your finances by consolidating payments into one, potentially lowering your overall interest rate. For instance, car loans, personal loans, and credit card debts often carry higher interest rates compared to home loans, making consolidation an attractive option....

Over 50 and buying property? Here's what you need to know about home loans

For many, the dream of owning a home doesn't retire at 50. In fact, entering the later stages of life can be an ideal time to reassess financial portfolios, consider investing in property, or even buy your first home. However, securing a mortgage after 50 comes with its own set of challenges and considerations. At My Mortgage, we regularly assist clients across a broad age spectrum, from enthusiastic first-time buyers in their 20s to seasoned investors who are well into retirement....

Will my Coffee Habit affect my Mortgage Application?

Funnily enough, a question that has become quite popular over the past few years: "If I buy too much coffee, will I be able to get a mortgage?" The short answer is yes, and that's fantastic news for all the coffee lovers out there!...

Rental strategies - is short or long term rental right for me?

In this episode of the My Mortgage Podcast, Greg and Claire delve into the realm of rental income options and explore diverse strategies for investment property success. From long-term rentals to Airbnb, rent-by-room setups, and seasonal variations, they uncover the nuances and opportunities in each approach.Greg starts us off by talking about the common methods of securing rental income: traditional long-term leases versus innovative approaches like renting by the room or leveraging the Airbnb ...

Navigating Home Loan Financial Hardship: How Banks Can Offer Relief

Financial challenges can arise for anyone, whether due to rising interest rates, job loss, illness, or changes in family dynamics. During these tough times, understanding your options for financial relief is crucial. Here’s a look at some of the strategies that can help alleviate financial pressures and how banks typically respond to claims of hardship....

Intergenerational Home Buying & Lending: A Growing Trend in New Zealand

In recent years, a noticeable shift has emerged in New Zealand's property market: more families are choosing to buy homes together. This trend of intergenerational living isn't just about sharing space; it's about combining resources to overcome financial barriers, care responsibilities, and more. In this blog post, we'll explore why New Zealand families are increasingly buying property together and the considerations involved in these arrangements....

Professionals you need on your Property Investment Team

In this episode of the My Mortgage Podcast, Greg and Claire uncover the important role of professionals in shaping a successful investment strategy. We start by talking about the role of mortgage advisors, emphasising their client-centred approach across various banks, ensuring optimal financial solutions and fostering long-term planning.They spotlight the significance of accountants in investment property ventures, clarifying their role in structuring tax optimisations and ownership frameworks;...

Landlords: Why Selling Your Investment Property to Tenants Could Be Your Best Move

As a landlord, the prospect of selling your investment property comes with several considerations, especially with the upcoming changes to the bright line test on July 1, 2024. This shift, reducing the bright line test from its current duration to just 2 years, presents a unique opportunity for both landlords and tenants....

What type of investment property is right for me?

In this episode of the My Mortgage Podcast, we're exploring the nuances between new builds and existing properties, navigating renovations, and understanding location dynamics.We're kicking off today by unpacking the differences between new and existing properties. New builds can offer distinct tax benefits and a streamlined lending process, while existing properties come with their own set of financial considerations and tax implications.There are two primary ways new builds come to life: fixed...

Reserve Bank changes - what you need to know about DTI's and LVR's

The Reserve Bank made some changes as of May 28th, 2024 regarding Debt-to-Income ratios (DTI's) and Loan-to-Value ratios, which is the percentage of a property's value that the bank can lend up to.These updates are pretty important for both homeowners and investors, so let's dive right in!...

Structuring your investment property purchase

In this episode of the My Mortgage podcast, Claire and Greg are diving into investment structures and ownership setups, exploring how they impact your borrowing ability and property ownership.We start today's episode by discussing the three most common ownership structures in New Zealand: Personal names, Look-through Companies,Family trusts. Each has its pros and cons, especially concerning tax implications and asset protection, and choosing the right structure depends on individual circumstance...

Tenants Buying from Landlords: A Strategic Move in 2024

With the recent changes to tax regulations coming in July 2024, many landlords are considering selling their investment properties. For tenants, this shift presents a unique opportunity to transition from renters to homeowners. In this blog post, we'll explore why purchasing the property you currently rent might be a strategic and financially savvy option....

How to use equity to renovate your investment property

Renovating an investment property can open up a lot of options and increase your cashflow significantly.When you have good equity in your property portfolio, it's a great way to add additional value, ensure you're meeting Healthy Homes compliance rules, and attract a great tenant.There is sometimes a perception that funding renovations can be a bit of a challenge, but not with good planning, advice, and an adviser on your Team! Here are some tips to help you navigate this process smoothly....

Government Announcement - First Home Grant changes May 2024

The Government has decided to discontinue the First Home Grant, which was the support they gave to buyers who had contributed to Kiwisaver for at least 3 years, and who met certain criteria around their income and the value of the house they purchased. Key things you need to know about the announcement...The sky is not falling - there are still plenty of options, and the First Home Loan, which allows a lower deposit and is Government guaranteed, is still in place.Kainga Ora aren't accepting...

"Show me the money" - How to fund your rental purchase

In this episode of the My Mortgage Podcast, Claire and Greg discuss how to fund your first investment property, and how this might look when you're approaching your bank.We discuss;Serviceability in property investment, breaking it down for everyday Kiwi homeownersThe big misconception - it's not just about rental income verses loan cost!Breaking down bank serviceability calculationsIncome is important - from salaries to more complex earnings like commissions, tax credits, and rental income. For...