Latest News from My Mortgage

Back to Blog

A Guide to Back My Build

(For information on ANZ's Blueprint to Build scheme, check out this blog)The team at My Mortgage are receiving heaps of questions around the recently announced Back My Build variable rate that ASB and AIA/Sovereign are offering. We have already arranged Back My Build home loans for clients and have some helpful information below to help you understand whether you are eligible and should take advantage of this product.  Back My Build is a new product offered exclusively by ASB and AIA/Sovere...

Why can't I buy a more expensive property if I have a large deposit?

It’s very common for a client to come to us and talk about their deposit. In the past banks were more lenient and may have lent money solely based on the size of the deposit. These days, banks are looking at more of a combination of deposit and serviceability. So what exactly does this mean?  When borrowing money the bank will look at what size deposit you have as well as the makeup of your household income and expenses. Basically, how much money do you have available once you have covere...

Low Equity Margins & Low Equity Premiums - What are they?

You’ve probably heard the terms Low Equity Margin or Low Equity Premium thrown around lately, so what exactly are they? What are Low Equity Margins & Premiums? Low Equity Margins and Premiums (LEM’s and LEP’s) are a fee the bank charges borrowers when they have less than 80% equity in their property i.e. less than a 20% deposit. For example, if you want to purchase a house for 500k, but have less than 100k deposit, then you are borrowing more than 80% of the value of the property. This is...

Refinancing your home loan in 2021

With interest rates once again at historic lows, and a busy 12 months in the property space, we're getting a lot of enquiries from existing and new clients who are considering a refinance of their home loan.Firstly - what's a refinance?Unlike a Re-fix - which is simply choosing a new rate and time period on your existing home loan, a refinance is effectively switching banks - either for a slightly better rate or situation, a bank which suits your needs, or perhaps some cashback offered by the ne...

Buying a house from family at below market value - How to make that work.

With the way house prices are going, a lot of parents, grandparents and "adoptive family" are looking at ways to help people out to get on the property ladder. One of the ays we are seeing this happen is family members selling property they already own, to their families at discounted rates. e.g The property is worth $700K but mum and dad are happy for you to pay them $500K for it. This is great and totally possible, but there are a few things to consider here and it is good to put some tho...

Meeting finance when there are still outstanding conditions

Meeting your finance clause is one of the most exciting parts of the process in buying your next home. Not only do you have the money ready to go, but you're more often than not also meeting your other conditions which means you're ready to confirm that you're on your way to being a home owner! I'd like to explain a little bit about that final part of the finance process and it all fits together. In some cases there will be remaining conditions to meet, but most of the time these are providing e...

Using Second Tier Lenders to get to where you want to go

At My Mortgage the large majority of the clients we work with we are looking at the main banks as the best option for them. At the main banks you can get the best interest rates usually and utilise things like their great online banking and other products like credit cards etc. However, not everyone or every situation fits with the main banks and when that is the case, second tier lenders can be a great options. These lenders are reputable trusts, credit unions and other lenders that have b...

Why would I have to lower my credit card limit or pay off interest free lending?

When we do new applications, we get asked all the time “why does the bank care about my credit card limit if I don’t have a balance on it?” or “why do they care about short-term interest free lending?”...Greg's got the answers in the video below, or read on for more info. ...

Buying with others - Being Jointly & Severally liable for the lending

With the cost of houses increasing as they are currently, it can feel a little overwhelming for people to buy on their own. Teaming up with someone else is a great option to increase deposit and income without doubling your expenses.  Buying with a friend or family member when you are both living in the property is fairly simple and is basically the same as being in a defacto relationship with that person and so there aren't a lot of differences from normal "couples" lending. The banks usua...

Financial Life Cycle

This graph talks about your financial position over time. Most of us start out with a high mortgage, and a mortgage that equates to a high percentage of the value of the property. Over time, the value of your property will increase (though we may see up and down fluctuations at times, it generally always shifts up), and as pay your home loan it will decrease. It takes a while for those lines to cross over, but they will crossover at some point! The first years will be harder than the followin...

Valuations - What's The Deal?

There are so many different types of valuations, but the one we deal with the most in our line of work are Registered Valuations, or quite commonly referred to as an RV.  What is an RV?  This is where a Registered Valuer will go out to the property, and take note of lots of specifics – things like the condition of the property, the age, the size, the features etc. Then they will research properties that have been recently sold in the area, as well as properties that are comparable in...

Lazy Loans - What are they & how can My Mortgage help?

A lazy loan is a loan that is not performing as best as it could be for you. Often, we find that when people are changing loan structures or loans are expiring, or they are buying and selling new properties, people end up with loans that are no longer tied in with where they are going and what their financial goals are. For example, if you have a loan sitting there that is floating, you are possibly paying double what you could be if you fixed that amount – higher interest rates means that yo...

Long Term Fixing - Is Now the Time?

For the last few years, we have been advising people to fix their home loans for shorter loan terms to take advantage of the downward trending interest rates, but it looks like we might be nearly at the bottom of the low-rates curve. There is no way to know what the curve will look like until we have some distance from it, but in our opinion (and plenty of other experts) all signs point to rates making an upward shift in the coming months. What’s long-term? We think that a 2 year fixed term is...

The Risk of Fixing Your Home Loan

We have seen over the last year or so that rates have trended down and rates have looked attractive on both the shorter terms and longer terms, so we wanted to have a quick chat to help you understand what the pros and cons are of both. ...

Changes to the First Home Loan & First Home Grant

Yesterday the government made an announcement on changes to help keep buying your first home within reach. One of the key changes made is to the criteria of the First Home Grant and First Home Loan schemes. The First home grant scheme gives first home buyers a one off payment from the government of up to $5,000 for existing properties or up to $10,000 for a new property. The amount you receive varies based on the length of time you have been contributing to KiwiSaver and each buyer can be eligib...

Building a shed to live in on my new lifestyle block - how can I do that?

It used to be a quarter ache but that has expanded to being the small lifestyle block, in the country with a brand new build and shedding for all your toys or somewhere to run your business out of. The process of getting this done can be complex and we all want to make the process of selling, buying and building to be as smooth as possible. ...

Getting your low equity margin removed.

When you get a home loan at more that 80% Loan to value ratio (Find out more about LVR's here) the banks charge you a bit extra for the privilege of borrowing that money when you have a smaller deposit. Not that nice of them but the reality currently! The banks do this in one of two ways:A low equity marginA low equity premiumLow Equity MarginThis is an additional percentage added to your interest rate that stays added until you get your loan to value ratio to below 80%. For most banks, thi...

Should I really be repaying debt?

Recording this video goes against everything I've said in my 14 years as a Mortgage Broker but I think it's a fair question worth asking.I've always been a fan of repaying debt as it sets you up to take more opportunities in future and give you financial security. However, with interest rates being so low the question has to be asked about whether you could be investing in more property or other investments to give you a return which is greater than what you're paying in interest.To bo...

Buying a property at auction with less than a 20% deposit

With the property market as hot as it is, a lot of properties are being sold via auction and understandably so. We are hearing of great prices for people selling their properties at auction. However, auctions can be emotionally stressful and there are a few more things to consider, especially for people who have less than a 20% deposit, which are normally first home buyers. ...

Should I be floating my loan?

This is a really good question to be asking at the moment and it's one that plenty are... Rates are dropping so there's merit in the discussion around floating and waiting for a better rate. Perhaps you've had a loan come off fixed and it's just sitting there waiting for you to make a move? The reality is that it doesn't really make sense to have a loan on floating at the moment Why?   Mainly because the gap between the floating rates (mid 4% range) and short term fixed rates (under 2....

Do you really need 40% to buy a rental property?

So you're looking to buy your first (or next) rental property? You might be feeling some FOMO that the major banks have decided to take matters into their own hands and pull back the Loan to Value Ratio requirements for rental properties - broadly these are now sitting at a 40% deposit across the board, and I've had several emails from investors who feel they've been shortchanged by the short 4-6 month window where they could buy rentals with 20% deposit. But - there is one slightly less well-kn...

This is the year to smash your mortgage!

The ducks are all falling in to a row when it comes to making repaying your mortgage easier and we think 2021 is the year to make some great headway on securing your financial future.  There's no doubt it's a great feeling as a home owner when your property value increases but ultimately you have to repay your mortgage before you can realize that equity, free up your cashflow and have more money to spend on fun things.There are a number of things lining up this year which will help you...

Getting a home loan when you're on one income

Buying a new home on one income either as a single person or when you or your partner are not working can feel really difficult but there are ways to make things work and things to consider. ...

Why we don’t often suggest splitting your fixed rates

I'm going to throw a cat amongst the pigeons of conventional wisdom here but I'd like to put it out there that I'm not a fan of splitting your fixed rates by fixing over different terms.What is this that you're talking about, Adam?There is an long held belief in some parts that you should fix your lending for different terms.  Say if you had a $500K mortgage you might fix $100K for 12 months, $200K for 2 years and $200K for 3 years.The theory is that you are insulated from any rate inc...

The gap between fixed and floating rates is increasing

The gap between the fixed and floating rates are increasing and if you've got a floating rate this means you're paying considerably more in interest, which ultimately means you'll be paying off your mortgage for longer (and making the banks more money!) Who does this affect? If you've got a home loan floating then this is definitely having an effect on you.   If your lending is $250,000 and you're paying 2% higher (difference between floating and 1 year fixed) then that's costing you a...