Any banks offereing homeloans with low deposits (5%)

[worsie]

Hey guys, we have been living in NZ for about 3 years now. Just seems none of the banks will offer us a homeloan at 5% deposit without IRV (Indefinite Returning Visa)

20% Deposit is not a problem, We just cant afford that.

Housing New Zealand offers 0% deposits on some of their loans. But apparently I earn to much to qualify for that, I'm just over $85,000 per anum. Talk about discrimination

Any ideas?

[langers]

I'd be amazed if any bank would lend at 95% even if you were a born and bred Kiwi in the current market

[IanW99]

Who have you tried so far?

I notice that the BNZ bank say...

How much will you be able to borrow?
Depending on your circumstances, we could lend you up to 95% of the value of your home.
This figure depends upon a few things like your income, current financial commitments and number of dependants. In essence, we need to know how much you can afford to repay – so you don’t end up taking on more debt than you can afford. As a rule of thumb, your loan repayments shouldn’t be more than about a third of your take-home pay.

And...

What will I need to apply?
There are a few general requirements when applying for a BNZ home loan. You need to:

•Be at least 18 (16+ if you are, or have been, married)
•Have a minimum gross income of $20,000 p.a.
•Have a clean credit history
•Have a deposit of at least 5% of the purchase price of the property

No mention of needing an IRRV.

Ian

[IanW99]

TSB bank also offer something similar...

Loans up to 100% of valuation are available.

And...

All lending services are subject to TSB Bank Ltd's current lending assessment criteria, interest rates and fees.

A $250 Application fee and a Lender's Mortgage Insurance Premium fee of 1% of the loan amount will apply. This can be added to the loan. If a deposit loan is required, an additional $100 application fee is payable.

Borrowers:

must not currently own a home
must live in the home they purchase, for the life of the loan
must be a permanent New Zealand Resident or a New Zealand Citizen
must have an acceptable credit history and be able to meet loan repayments

One thought, have you confirmed the need for IRRV at the bank? There was another post on the forum where someone had been advised that they needed IRRV when in fact RRV was sufficient. A few phone calls cleared up the confusion.

Ian

[batgirl1001]

Have you thought of also going to a mortgage broker besides going to just BNZ for a loan? These guys are in the business and know if you've got a case or not. You should explore all options.

In our case we had more than the 5% but definitely less than 20% and it was pretty much a ringaround until we got one bank's approval. And it certainly wasn't BNZ.

[IanW99]

Have you thought of also going to a mortgage broker besides going to just BNZ for a loan? These guys are in the business and know if you've got a case or not. You should explore all options.

In our case we had more than the 5% but definitely less than 20% and it was pretty much a ringaround until we got one bank's approval. And it certainly wasn't BNZ.

Don't think the OP even mentioned going to BNZ for a loan?

How about saying which bank you did go with, it may save them also having to do a ringaround?

Ian

[KatieBen]

Would definitely suggest a mortgage broker. See reply on thread about fast tracking IRRV, but we managed to get an 80% loan on a section (normally they have a 50-60% maximum loan to value) based on income and ability to pay.

Can recommend Mike Pero in Nelson, not sure about whether the rest of the chain is as good.

[batgirl1001]

No need to be so snide. I was merely suggesting to the OP to explore all options and not just focused on BNZ just because it was mentioned here that BNZ allowed for up to 95% lending.

In my experience banks promise a lot but underdeliver on those statements. Westpac says very much the same thing- you don't need a 20% deposit for a housing loan yet they pretty much snubbed their noses at us. Caught our mortgage broker out by surprise too~ because he was pretty sure they'd say yes. They mention about disliking the assets we had but never went to explain further than that.

So in any case, don't expect them to exactly follow through just because it is written in black-and-white. In every case, there are enough "circumstances" for them to say no and it can be quite crushing for a person to go from bank-to-bank and be rejected summarily everytime. A broker can do the work on your behalf and know which bank or who to approach for a loan.


For us it was ANZ- and we also got a bit of a discount on the rates too. But even then it wasn't easy smooth sailing.

[victoria24]

bnz do 95% depending on many other factors..

[folubode]

BNZ recently did about 94% lending for us but personally i believe it took God's intervention. Apply online and hopefully the lending adviser that will be asigned to you will be someone that will be ready to listen to you and push your case with those that make decision...