[pint of guinness]

Hi all

This is my first post, so please bear with me.

We have fairly recently arrived in the country and have been renting for a while and have now decided to make the leap and buy a property (yikes). We have found the home we want and are now needing to arrange the mortgage.

How easy or otherwise is it to arrange a mortgage here? Can any of you recommend banks for their service / speed /interest rates etc?

Also my husband (Arclite - he used to post on here) raised the subject of an off-shore mortgage - have any of you gone down that route?

Thanks all :)

[Moorf]

Hi Pint and welcome to the forum :D

We found applying for a mortgage here very easy. We are with National. You might want to shop around for rates though and get some advice on whether to fix or not at this stage.

Our bank gave us a certificate with our maximum borrowing figure on it after a quick conversation on the telephone. We then knew when we went to auctions or saw a house and wanted to put in an offer that we had XX to spend although more could be negotiated but it's what they saw as our safe level.

After that, once we'd found somewhere we liked we had it valued and sent the valuation to the bank for them to "approve" - however they didn't ask for a valuation on this place - I guess they have a feel for what is a good price or not.

That's pretty much it from our point of view.

We haven't had to borrow more than 20% for a mortgage and I know that if we had wanted 80% or more they would have had to have gone into our earnings etc a little more.

Our first purchase we had a reply from the bank the next day. They're pretty efficient.

We're in Chch.

[Diny]

P.O.G ... welcome to the forum, how you settling in to NZ?

There's been lots of talk on the forum about mortages, but just as a brief re-cap.

We got our mortgage through ANZ. We have found them to be FANTASTIC. Our mortgage was literally approved on the spot, took about 30 mins. We had to supply payslips and the usual documents. We were also required to provide a UK credit rating too, however, I understand that alot of people haven't had to supply one, so I guess it's just down to each individual bank.

Once we had supplied said documentation we got a firm offer (in writing), the whole process took about 4 days in all. if we had the UK credit check when we applied it would have taken just a few hours to complete the process.

A few months after buying our house we bought a rental property too. We went to ANZ for the mortgage and because we were classed as 'good customers' we were able to negotiate alot of extras. They waved their fees and knocked 1% off both mortgage interest rates for us. I've heard that other fourm members have been able to negotiate fees too.

Hope this helps.

Diny

[Diny]

After that, once we'd found somewhere we liked we had it valued and sent the valuation to the bank for them to "approve" - however they didn't ask for a valuation on this place - I guess they have a feel for what is a good price or not.


.


As I understand it, if you buy a house that is being sold through a real estate agent then you do not have to provide the bank with a valuation as they 'accept' the price put on it by the agents.

If you buy a house that is being sold privately the bank will require a valuation. I guess this is so the seller can't put some bumped up price on it for his own gain.

We've found this to be the case anyway, our first house was an agents sale - bank didn't need a valuation. Our current house was a private sale - bank did need a valuation.

Again - this willprobably vary from bank to bank.

Diny

[Nienke]

Welcome to the forum Pint!
We used a mortgage broker to do all the legwork for us, as we were new to the country and the system. He got us a very good deal with ASB.
If you are in Auckland, just give a pm if you want name and phonenumber!

[Moorf]

As I understand it, if you buy a house that is being sold through a real estate agent then you do not have to provide the bank with a valuation as they 'accept' the price put on it by the agents.

If you buy a house that is being sold privately the bank will require a valuation. I guess this is so the seller can't put some bumped up price on it for his own gain.



Not in our case Diny, we bought this place via a TradeMe advert and didn't involve an agent at all and the bank didn't want a valuation.

I guess your financial position, deposit, income, property type and location etc all dictates the risk and whether they need to get a valuation done etc.

[Avalon]

We went with ASB in the end though it wasnt my first choice. Originally we were going with Westpac - as they had a deal for Telecom employees, and ASB couldnt quite match it (and I wanted to leave ASB cost the migrant bank manager was annoying me) All was sweet while takling to the Mortgage arranger, but when it came to getting it all done - we were passed on to our "personal Relationship manager" and he was utterly obnoxious! Patronising and arrogant - spoke to me as if I was 12 years old on could just about decide what to do with a piggy bank! Now bear in mind at this point Im well on the way to getting my fanances sorted, have budgeted till im blue in the face and can tell exactly what ive got in the bank and what I havent got. Not a happy bunny. ;)

So back to the ASB i went. Turned out the guy who had sorted the mortgage out there would be my manager :) and they matched Westpac. We nogotiated the rates, got the fees taken off, and got fee free baninking for my parenst and brothers accounts. Diny got a better discount though - so when I have to go back and renegotiate - im expecting my 1% :D

We took a chunky mortage, but had a big equity stash, so that made it easier, but you can negotiate to a point without it. To be honest - the worst can happen is that they say no and you end up with standard rates and fees - so try it anyway.

One thing I would suggest is ask every bank for quotes, and ask them all to negotiate. I very rapidly took two banks off my list because they wouldnt move on rates (ANZ and HSBC). You will rapidly get to know what the deal is and get a feel for the best way to strucure the mortgage.

Do be aware that you can split your motgage into chunks, fixing some for different legths of time, having some on a normal flexible mortgage, or some on a "revolving Credit" (In the UK its like the old Virgin One Account - cuurent account witha very big overdraft).

I would say if you are thinking of a revolving credit account - you do need to be very good with organising your money - as its all too easy to end up with the OD limit never going down - so you never pay off that part of the mortgage. Some banks have these types of accounts where they do drop the limit each month - so if you wanted one, but feel concerned - look for that.

HTH

[jubjub]

Ours is with Kiwibank and was very easy to set up.

Had to prove we had the deposit (bank statements did this) and proof of income, (copy of hubbys contract). Only thing that was a bit different to UK was that the mortgaging company have to have a copy of your buildings insurance, and they have to be named on it as an interested party, this has to be in place for completion to take place.

I did hear a rumour that brokers can get a better rate for you, but I dont know how true that is, keep meaning to ask my friends hubby, its what he does!

[pint of guinness]

Thanks everyone

Have spent the day negotiating the purchase contract, finding a solicitor, requesting the LIM report...... Husband thinks that I sit at home all day watching UKTV and drinking coffee :laugh

I did go to the National Bank, and they were very helpful, even tho the person I saw doesn't deal with home lending. Have also been told that Kiwi bank is offering good deals, so I'll have to check them out too.

Thanks for all the tips - I'll get my walking boots on and trawl around the town tomorrow !

[Avalon]

Thanks everyone

Husband thinks that I sit at home all day watching UKTV and drinking coffee :laugh
!
Nowt wrong with that :D

[Smiler]

Hi Pint

Welcome to the forum. :cheers

We haven't purchased a property in NZ just yet, we're still doing our research. *sighs*

At the risk of bleating about my new toy, have you looked on www.consumer.org (http://www.consumer.org). Kiwi bank and Bank direct came out tops in their survey.

I'm nowhere near the financial level of guru Avalon, but this intrigued me from the consumer website; :confused: seems to simple to be true.

Paying fortnightly instead of monthly is a very smart way to reduce mortgage costs.

As we all know, broadly speaking a month is two fortnights. But there aren't 24 fortnights a year; there are 26. Paying half your monthly repayment every fortnight means, in effect, you will make an extra month's repayment each year. You probably won't even notice.

Again, say you're repaying $150,000 over 20 years at 6.7 percent. The monthly repayment is $1136 and the total interest bill is $122,662. If you pay half the monthly repayment each fortnight, the term drops to around 17 years and you save nearly $21,000 in interest.


Coupled with the info from everyone above, you'd be well armed with for the bargaining process. Good luck.

[Smiler]

You mean you're not sitting at home with a pint of guiness? :D

[jubjub]

You mean you're not sitting at home with a pint of guiness? :D

:laugh :cheers

[pint of guinness]

I'm actually getting a taste for Speight's Dark !!!!! Must go for a Guinness soon.....

:cheers

[Avalon]

Paying fortnightly instead of monthly is a very smart way to reduce mortgage costs.
.
Too right! We dont do this - as the way we have ours set up - it actually odesnt give us an advantage (with a revolving mortgagae - often at a higher interest rate - you need to keep all your pennys in that account as long as possible - if you dont have one of them Fortnightly is better).

If you use the "fine tune your loan" calculator on Westpac
http://www.westpac.co.nz/olcontent/olcontent.nsf/Content/Home+Loan+Calculator+-+Fine+Tune

It will show you exactly how much money you can save between a monthy mortgage and splitting the amount in half and paying that fortnightly.

Plug in the numbers for a monthly mortgage and hit calculate.
That tells you the monthly payments and how much interest you pay overall.
Under "Change payment frequency" - lick option a (half monthly amount paid fortnightly) and hit recalculate
It then tells in nice friendly red letters just how much you save overall and how much time you just knocked off your mortgage.

[pint of guinness]

Thank you so much for all this info.

:D

[pint of guinness]

Husband was dispatched to the bank today with details of interest rates we'd found from the links you'd all given us, and instructions not to bother coming home til he'd sorted it!! He managed to negotiate a deal, and get a lump sum towards the legal fees :raebanana

Thanks everyone :nice1

[Smiler]

You are welcome! :D:D:D

Don't you just love it when a plan comes together...............

[wolfysmith]

Try Kiwibank. They offer some great rates and don't just think of the bottom line for the bank - profit. I know I used to work for them in their mortgages dept!

Don't forget that mortgage brokers in NZ (like everywhere else) receive a fee from the lender if they introduce business to that bank so may not always have you at the forefront of their mind when they choose the lender

[Babette & Andy]

We to are doing our figures to see what we can afford, and have had our 1st chats with a mortgage broker (waiting for figures to come back). Swaying towards a 5yr (low) fixed interest rate to give us a bit of a breather these first years in NZ and also to wait for me to go back to work (Feb'08) when Amy starts school and as such have a 2nd income again.

Interesting to read that some of you were able to get a further discount / reduction. If it's not too personal, I would be very interested in hearing what % you've been able to negotiate down to.

Thanks all

Babette

[StevieD]

Interesting reading this, thanks for the links guys and gals ;)

Steve

[Avalon]

Interesting to read that some of you were able to get a further discount / reduction. If it's not too personal, I would be very interested in hearing what % you've been able to negotiate down to.

Thanks all

Babette
I got 0.5% off my variable rate on the Revolving Credit mortgage (thats the ASB orbit account - I also negotiated a refund on the monthly fee of $10 - but forgot to negotiate a refund on ALL fees - so I do still have to pay $1.50 a time to set up automatic or bill payments :( ) So im currenly paying 9.05% instead of 9.55%, thats on a mortage of 100k. This is variable - so goes up and down (I wish) as the bank rate changes - but I stay 0.5% below the advertised ASB rate at all times.

I got 0.25% of the 2 year fixed rate so im paying 7.42% instead of 7.67%. Thats on 165K

I also got an aggreement to refund all fees payable on my parents and brothers NZ accounts, upto $20 a month on each account.

AND - I got my first year Credit card fees removed, as well as the fee for joining the Credit card reward program.

All in all, over the first two years - it is saving quite a packet!

A lot of what you can get depends on the numbers - $265k mortgage is quite high. But my top tip - even if you arent looking at anywhere near that much:

Shop around and TALK to the mortgage managers. I must have had 6-7 meetings with the guy at ASB; asking loads of questions about how things work in NZ. I also knew what I wanted - because I have read Anita Bells books on the subject a few times ;) so had a very good idea of what I was after in order to save the most money. I built up quite a relationship with the guy before we ever signed on the line! If anyone is patronising, or doesnt give you the time of day - go to the next bank. ANZ i never got forther than a first meeting with for this reason - that and they will give a measly 0.1% discount on the rate - and charge you for it!

Also - ask banks if they can match or better an offer you have somewhere else.

And remember - the worst that will happen is that they say NO. And they very well might say YES - so its always worth asking the questions!

[wilson182]

We are with Westpac, and when their chap came to see me I told him that I was thinking of taking the Kiwibank offer of 7.75% fixed for 3 years and no account fees. He matched their rate AND offered no account fees and changed my savings account so I dont pay fees for account transfers from there.