Family Photo

So you don't quite have a 20% deposit?


By Jeff Kerwin - NZ's Top 10 NZ Mortgage Adviser 2017
 
Photo of Jeff from Nest Home Loans

Solution 1: The Welcome Home Loan
The Welcome Home Loan is a government backed mortgage that allows you to purchase a home with a 10% deposit. This mortgage has some of the lowest low deposit interest rates, but there are big differences between banks so make sure you get advice on where to place this mortgage. There are also rules regarding income and location so please contact a Nest Home Loans Adviser to discuss whether you are eligible.

Solution 2: A Gift or Guarantee - The bank of Mum and Dad
Members of your family can gift you money towards your deposit, or they may have equity in their own which we could help you with your deposit. A family member can guarantee a portion of your deposit by offering some of their equity to the bank as extra security. Those family members need to agree that they will be responsible for the mortgage if you're not able to pay it for any reason.

Solution 3: Low Deposit Mortgages
It may be possible to buy your home with a deposit as low as 5%! The Reserve Bank restrictions still allow a portion of low deposit loans to go through, and we have lots of options with other lenders like credit unions who are able to lend. New builds are exempt from the restrictions! There are many criteria so it is best to get advice on this before you make offers on houses.

Solution 4: A personal loan secured by your home
If you are just short of 20% deposit you are able to borrow some funds to make up the difference. This is a helpful tool if you don’t meet criteria for other low deposit lending, or if you have other debt you want to refinance into the house. The catch is that you might be paying a higher interest rate for the second loan until we are able to refinance your loan back to the bank.
2 years or when there is 20% equity we refinance you over to a mainstream bank and get you sharp rates. Rather clever don't you think?