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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...

Splitting your investment and personal home lending across different banks

If you're a property investor then this is a key financing strategy that you should be considering.  The right mix is different for everyone but we're here to help give an objective view of the bank's lending options that will suit your needs and goals. What are the benefits to splitting your lending across different banks? There are 3 key factors Insurance against policy changesLimiting your treatment as a commercial investorThe right bank product for the right scenario  Policy change...

Banishing Short Term Debt forever...

Every single day, as a Mortgage Broker, I say to myself “I wish more people understood debt and how to beat it”. People contact me to buy their first home, and at least 50% of the time either their capacity to borrow is significantly lessened by their existing debt. Or, they are unable to borrow altogether because their total debt is actually more than their deposit overall and the banks are just unable to lend them money until they pay off what they already owe....

Using KiwiSaver for your unconditional day deposit?

For many first home buyers, their KiwiSaver forms a large part (some if not all) of their deposit for a home, and we are frequently asked the question as to how this can be used to pay their deposit on unconditional day. Firstly - for the difference between your overall deposit and the one you pay via your Sale & Purchase Agreement - check out our blog here  So let's debunk some myths - KiwiSaver can be used to pay your deposit and is regularly used as such. However it does mean you need to...

Building & Renovation Mortgages - How it all works - Construction Lending Part 1

This is the introduction video into a series all about construction lending and all the ins and outs of it. In this series Greg covers house and land package and turn key builds, fixed price contract finance, owner managed and kit set build home loans, transportable, relocatable and tiny home finance and finally we have a video about the most frequently asked questions we get asked about residential construction lending.Construction lending can be difficult to understand and breaking it dow...

House & Land Packages & Turn Key Homes - Construction Lending Part 2

Turn key build and house and land packages both very similar. So let’s start with house and land packages. ...

Fixed Price Builds - How do they work?- Construction Lending Part 3

Fixed Price Contracts are the most common way we see people building new homes. The way these types of builds work is that you’ve found a piece of land, maybe a smaller section, maybe you subdivided, maybe you found a lifestyle block and then you’re getting a house designed and built for you on that piece of land.  The design could be done by an architect, drafts person, or quite common now is a building company that have already got plans that can be modified it for you or they have pe...

Transportable, relocatable and tiny homes - Construction Lending Part 4

These are three types of builds that are becoming really popular obviously as there’s a lot of efficiency (financial, time and environmental efficiencies) that can be made when things are built off site, in a specific location where they’re meant to be built. The builders and other tradies are all in one place together and they can do lots in a much quicker period of time. It is a way to get a really cost effective house on to site. The main consideration from a lending point of view is that...

Building & Renovation Lending Frequently Asked Questions - Construction Lending Part 6

If you’re building a house and you’re not living in it while you’re building, you will need to be paying rent or your previous mortgage while that house is being built in a fixed price contract. However, one while you're building the home, you’ll only be paying interest on the amount of lending you have, not the principal and normally with the fixed price contract you’ll be accessing funds a little bit at a time throughout the build. So initially you may have a very small home loan for...

Self Managed Builds & Kit-set - Construction Lending Part 5

So a self managed build is that you as the home owner organise all the tradies; the builder, the plumber, the electrician, the roofers, the painters, everyone individually to come and build your new house for you. Now although you can, at times, save money in those kind of situations but going around and finding the best deal and demanding certain products etc, if you don’t have previous experience in construction or project management and you haven’t got everything lined up and ready to go,...