Mortgage Checklist

It's stressful buying a home, whether it's your first time or last. Here's a list of things you can work through to make sure you're prepared. Remember a financial adviser can help you work through and submit the application for you.

What's your home loan budget?

We have an article here that covers tips and information on getting a deposit. We suggest savings tips and also outline help you can get via KiwiSaver and the First Home Loan scheme available from some banks. We also have links to budget apps that will keep you honest when assessing how much you can afford.

Find your home

Are you going to build or buy an existing house. You'll need to weigh up the time versus getting exactly what you want. The best way is to start looking and you don't have to leave the house. Here's a few online resources to use.

homes.co.nz - search by map interface

trademe.co.nz - not just your second hand good, they also have a property section

realestate.co.nz - official website of the Real Estate Institute of NZ

oneroof.co.nz - website version of the print version in the NZ Herald

Decide on a bank or broker

We address this decision in this article, the key thing is that you find the right person for you. This decision is supposed to make things easier because you've found someone you can trust who will help by doing a lot of the work for you. Regardless of who you choose you will need to know the following to kick off the process.

1. What deposit I have and where it is i.e. KiwiSaver, savings account, gift from parents etc.
2. What is my income and how long have I been employed there.
3. What are my debts.

What kind of mortgage is right for you?

Do you want to split your mortgage into part fixed, part floating. There's reasons to do that based on your expected future income. It may also be that you are suited to an Offset Mortgage or a Revolving Credit Mortgage. The links take you to our articles which explain the ins and outs but that's also part of your financial advisers job - to advise you on the best structure for your mortgage.

Mortgage pre-approval

If you know your budget and want to get organised, contacting a financial adviser and getting pre-approved for a specific loan amount means you can move quickly when you find the right property. You don't have to do this but it can speed things up once you've selected a property.

The paperwork

Here's some things you'll need to work through.

Building inspection and valuation

You can read up on this government website concerning advice about buying a house. But the bottom line is "A pre-purchase building inspection is advisable for all properties, but essential for homes that may be at risk of leaking or have been damaged by a natural disaster."

Land Information Memorandum (LIM)

This is a report that contains the summary of information about a property from council records. It's essential to get an up to date LIM report, it shows things like zoning, rates owing, land features etc. Here's a link to the Auckland Council's website explaining what's in a LIM.

Getting a lawyer to complete the ownership transfer

You will need a lawyer or conveyancer to complete property transaction. Having a lawyer will ensure you cover any extra issues that may occur.

Good things to know

Good bank account conduct

Good bank account conduct for the previous 3 months is needed to get a loan. Make sure you have no dishonours, this is simply showing the bank you can manage your expenses.

Pay off Debts

Banks will consider all debt like buy now pay later, credit cards and personal loans. If you can pay these off, this can improve your affordability calculations.