Great News for First Home Buyers | Mortgage Advice on the HomeStart Grant & more

Written by:

Steve Davies - Mortgage Adviser

More options are becoming available for first home buyers.  Now that the banks have balanced out their lending ratios to comply with the restrictions imposed by the Reserve Bank on LVR (loan to value ratios) as Mortgage Advisers we are seeing more approvals for First Home Buyers.

Although the Reserve Bank has put a limit on the amount of lending the banks can approve over 80% LVR, it is still possible to submit and get an approval for loans up to 90%.

This can be achieved through the Welcome Home Loans scheme which is supported by a number of banks plus the mainstream banks can now approve borrowers under their own criteria.

Today we see more and more clients with KiwiSaver money that will meet the 10% requirement and as first home buyers they may also be eligible for the HomeStart Grant from Housing NZ, which is a separate application, as well as being able to use much of their KiwiSaver money towards the deposit.

The Welcome Home loans have strict criteria around the house price and income level of the applicants and we can discuss this with you to see if you qualify.

Also we are now seeing a lot of parents supporting their children into a first home by allowing equity in their home to be used to bring the overall lending level under the 80% LVR. This can be an easy and straight forward process with limited liability in most cases for the parents and a target of having their property removed as soon as possible.

They call them mortgage wars… At the moment we are seeing the banks competing aggressively with each other to gain market share and this is resulting in very competitive interest rates for home owners and buyers.

Fixed term interest rates have been dropping since November 2014 as banks try to attract new customers who are buying or refinancing. This is marketed primarily at borrowers with 20% equity or deposit, but is also benefiting those with smaller deposits. Cashback and legal costs contribution are part of the package and it is you the consumer who is benefiting.

The latest rate drop just announced by one bank is a five-year fixed interest term at 4.99%.  There are conditions though, and that is where we can help you to understand which option will suit you best.

We always appreciate the opportunity to meet to discuss the various options available for you.  Please contact our Mortgage Adviser Steve Davies by email steve.davies@colemurray.co.nz, phone direct 021 229 9422 or call the office on 06 870 7050.