The Mortgage Man - A podcast for everyone with or wanting a mortgage

Should you buy or build your first home?

Before you answer that, it would be important to under the process and costs of building a property. That includes how to finance it from the bank.

Because things are a little different.

There is more than one option, but usually, it's a turnkey option or a progressive option. If you don't know what those terms mean then you neeeeeed to listen to this podcast.

And if you know what those terms mean you should listen to this episode anyway as Steve from Classic Builders, and I cover alot more.

Let us know what you think, and if you want to work with Steve his email is stephen.hape@classicbuilders.co.nz

Want to sell your property soon?

Is now a good time to sell? How do you get the best price?

Is it best to list via auction or negotiation?

Completely renovate your house or leave it as is?

All these questions are useful, and I didn't know the answers so I decided to ask someone who does know the answers, and the person is Rachael from Harcourts.

Have a listen, and let me know what you think.

Open homes are scary - and auctions even more so.

What can you do at open homes to give you a bit of an advantage over everyone else? What can you ask, & what are you supposed to look for when going through a stranger's home that you like?

In this episode, I pose these questions and many more to Rachael from Harcourts as we discuss the open home process as well as the buying-at-auction process if you really like a home. How do you win the auction and what can you do to increase your chances?

Enjoy

Do you need a property accountant? Probably - With guest speaker Anthony Appleton-Tattersall, my accountant.

Property tax is becoming alot more complex with all the changes, so whether you think having a property accountant is worthwhile depends on a few things.

And in this episode, I speak with my accountant on a few of those topics, including

- Capital Gains Tax

- Brightline

- Trusts (do these really save you tax?)

- Interest Deductibility changes

And much more..

If you want to reach out to ask Anthony a question his email is anthony@aataccounting.co.nz

Buying a home is a big deal.

It's a lot of money, and most of it isn't even yours.

So you want to make sure it's done right. A big part of that is getting a lawyer to check the contract and property documents for you; and of course faclicate the purchase and any other issues that pop up.

This week I talk to Adam from NZ Legal to explain at what stage a lawyer should be involved and all of the other things you need a lawyer for when it comes to property.

Sometimes there will be property features that you will love.

Other times not so much, and even more so there will be times when alarm bells go off.

So should you walk away or can you turn these red flags into opportunities?

- Mono plaster cladding properties.
- Unconsented works

- Leasehold titles

Have a listen and let us know what you think!

Last week the inflation report came out and while it wasn't exactly what we wanted, it's still going to impact the housing market.

Ant and I have been going over the numbers and want to share our thoughts with you. We're breaking down how the inflation report will affect house prices and interest rates in the near future.

This week has been a little crazy in the mortgage world, with some banks raising rates and others lowering them. But, the good news is that long-term rates are now lower than short-term rates. This means that banks believe that interest rates will be lower in a couple of years. Yay!

And that's great for you, especially if you're thinking about refinancing or buying a house with a 20% deposit. You have some serious negotiating power now and can either get more cash back or lower interest rates. Let us, your mortgage bros, help you make the most of this opportunity.

We hope this email gave you a better idea of what's going on in the market. If you have any questions or just want to chat, hit us up!

Well, that was unexpected.

Jacinda resigns.

What does this mean for the future of the property market, first-home buyers, and the rental market in New Zealand?

I think the biggest effect this is going to have is now it drastically decreases the chances Labour has winning the next election, thus meaning National is likely to get in.

And for that, there are some clear policy differences- listen to this podcast as Chris & I dissect them. 

It's never nice to talk about, but sometimes serious illness, accidents or death happens.

In those situations, most people do not want to have to sell their homes to pay the bills or mortgage if one person can no longer work.

That's where mortgage protection insurance can help. But do you actually need it?

Today, Anthony & I discuss this and other potential insurance products to protect your assets.

We also talk about other ways to protect your wealth if you and your partner were to separate; again this is something that most people don't like to discuss but you would rather have things in place just in case.

Have a listen and if you have questions hello@tanta.co.nz

Fear of losing your deposit if the developer goes under?

Fear of buying a house that's going to leak or fall over?

Fear of overpaying in this market?

Fear of rates increasing so much you can't afford them?

Fear of the home value decreasing the day after you buy?

A lot of fearful thoughts..

But no worry..

We are here to save you- hopefully.

Chris and I cover why these thoughts, although quite normal, should not stop you from buying your first or any other home.

Why?

Because you have so many safety nets in place before you buy.

After all the bank is taking more risk than you by giving you a mortgage as they will own up to 80-90% of the property at the start, and they want to make sure the property is not overvalued or going to fall over the next day.

Have a listen to get more reassurance

..and remember buying when interest rates are higher is a good way to get a discount on a property; and that will make a bigger difference to the total interest cost over the lifetime of your mortgage.

The OCR is up again, and this time a massive 0.75 jump. The biggest jump we've had.

Should you care?

Yes; especially when you hear The Reserve Bank say things like "we are trying to purposely put NZ into a recession"

This podcast is quite sobering, but we do give you tips on how to get out the other side.

If there is only one thing you learn by listening it is this; stop spending money you don't have and start saving more than you think you need. 

Negative equity is a term most of us haven't heard in a while but is becoming a real possibility for some homeowners, especially those that brought in the last 12-18 months.

But what exactly is it?

Negative equity is when the property you own is worth less than the mortgage you owe against it.

For example, you buy a property for $ 1.2 million, your mortgage is $ 1 million but then the house price drops to $900,000 - you now have $100,000 of negative equity.

Is this a problem?

Not really - only if you need to sell the property at a loss.

And if that happens the $100,000 that you owe the bank will turn into a personal loan that you will need to slowly pay off, at a higher interest rate.

You want to avoid that like the plague because your chances of buying again anytime soon and having to save a deposit again will be close to zero.

So if you are in this position; with increasing interest rates and living costs, you don't really have too many options; but here are three..

1. Grin and bear it, house prices will go back up.

2. Ask for an interest-only period, or mortgage holiday (more on these in our previous podcast here)
3. Figure out a way to increase your income (work more, get a flatmate)

We go into this a lot deeper in our podcast so have a listen here

Need help?

Hello@tanta.co.nz

We always hear "I'm going to wait until house prices drop before I buy"

The problem is, that for house prices to drop, the cost of money has to go up. The cost of money, also known as interest rates are the highest we've seen since 2008.

Does this higher interest rate cancel out any house price drops?

We've done the maths and although it does in some cases, it's pretty clear that there is not one size fits all and there are some very clear takeaways in this current market situation.

Have a listen and if you need an explanation or a mortgage email us at hello@tanta.co.nz

This week's episode talks about the very first step of the mortgage process. KiwiSaver...

Getting this right or wrong can be the deciding factor of "when" you buy your first home.

Are you making the correct contributions?

Are you in the correct fund?

Are you with the right provider?

All of these questions have specific answers for your own situation. It is certainly not "one size fits all" when it comes to KiwiSaver.

We deep dive into all of this and the reasons why your KiwiSaver balance might have dropped a bit recently with none other than Luke Stockman, our KiwiSaver specialist.

If you are thinking about buying a house, then you need to start here.

As soon as people decide that they want to buy a house, the next question is how much can they borrow.

Sound familiar? So then you go onto your favorite bank's website to use one of their basic calculators to get a ballpark figure.

However, they are just that. Very simple.

In fact we have tried them all and there was a difference of $210,000 between the highest and lowest loan amounts based on the same data between the 5 big banks in NZ.

That's not very helpful when you are trying to narrow down your search criteria.

So is there a better way?

100%

It just depends on how far down the rabbit hole you want to go.

But ultimately remember this;

The bank decides how much you can borrow and the bank is going to do the most thorough search of your expenses, debts, and credit history.

Have a listen to this insightful podcast on how to refine your max borrowing amount and make sure you listen to the next episode where we go over ways to increase your borrowing amount so you can get more money (if you want more money that is)

hello@tanta.co.nz if you need help or have any questions. 

To this point, most of our content has been about how to get a mortgage or buy a house. But what happens once you have actually got a mortgage?

Are you stuck with it for 30 years?

Or are there some ways to pay it down faster?

Yes, there are 3 main ways.

Depending on how actively or passively you want to manage your mortgage will depend on which one might be best for you. Or a combination of the three.

These are

1. Making more than the minimum repayments

2. Making lump sum repayments 

3. Utilising a revolving credit account correctly.

Have a listen to see which is best for you and then chat with us to confirm and see if we can offer you any other guidance.

Hello@tanta.co.nz

Or if you don't have a mortgage yet, but want one.. then email us too!

Lots of different opinions on what fixed rates are doing, and what you should do with either a new mortgage or a part of your mortgage that you need to refix; these options are more important during times of high inflation.

The current rate for 1 year fixed is 4.95% and the floating rate is around 6.75%

The main thing when deciding what to do with your rates is your personal situation, how you get paid, and what your plans are for the property.

Having a mortgage broker who understands your situation is super helpful with this.

So would being able to tell the future, but that is not possible, we can only recommend the best way to reduce the risk going forward by setting up your mortgage structure in a certain way.

This podcast covers what we think you should do during this economic time and covers a bit of background as to why the interest rates are at today's levels.

Banks have been getting a bad rep lately with all the new rules and them just trying to de-risk themselves in a property market full of unknowns.

But if you want a home, you kinda need a bank to give you money.

So, which is best?

Well, it depends on your situation and the current rules at the bank.

If you want a new build, then some banks are better.

If you have a smaller deposit then you might only be able to go to your own bank.

If your income comes from a self-employed business or from overseas then others a better for you.

The great thing? You don't really have to know which is best based on your situation, you just need to entrust your application with a mortgage broker that knows what they are doing.

So listen in, learn some stuff and then send us your information. :)

It might be tempting to want to buy in a different town to where you work to make it more affordable for you to buy your first home.

However, it doesn't work like that.

There are rules..

Firstly the commute - it kinda needs to be less than a 1-hour drive from where you work. But now if you can work from home.

If you are thinking you can live in one place on the weekends (your home) and then rent in the city you work in then we need to add that extra rent to your expenses which will usually throw the numbers out.

Or you could buy an investment out of town?

Then there are other things to consider. You won't be able to use your Kiwisaver for one and then what is the long-term plan?

A lot to think about, hence the podcast episode.

Have a listen, I am sure it will help you.

Revolving credits are complicated.

It's one of those things that you learn by doing; but in this episode, Chris & I try our very best to describe how these accounts can save years off your mortgage & save you $10,000's in interest.

We cover who these kinds of faculties are good for and who should stay well clear.

We also go over how to make the most of the accounts and what pitfalls to look out for.

They are not for everyone but used correctly they can be very effective.

hello@tanta.co.nz if you think our explanation was on point.

We sometimes forget that the language we use when talking to first-home buyers is not appropriate.

I don't mean we use swear words or shout profanities but more so we use words that you may have never heard of.

Our fault.

But also lawyers, real estate agents, and other pieces of educational material use these same terms.

So in this podcast, we get to be a walking, talking dictionary - with a bit of banter mixed in.

It's important that you know these terms so you are 100% certain when you hear them and avoid any confusion when buying a house (it's kinda a serious thing)

It's tempting.

Pooling your money & income with a friend or family member so you can buy a home or a better bigger home that usually wouldn't be able to afford.

Although it's a great idea at the start of the process, what about at the end?

What if one of you no longer lives there or wants to sell?

Or has to sell?

There are many things that could happen and not all of them turn out great for the relationship.

In this podcast, we cover what you should do, and what to be aware of in two different scenarios.

- Buying with a sibling or friend

- Buying with parents

It's very likely that you have considered one of these two options so knowing what to look out for is essential.

All of the three boys here at Tanta have brought with a sibling in the past so we know more than enough on this topic as well as doing mortgages for multiple people in this situation. 

It's been a busy month in July for mortgages and offers.

This podcast covers all of it.

We go over 7 key things.

1. 1% cash back from BNZ

2. 1% interest rate for top-ups at ANZ
3. Inflation is at 7.3%

4. OCR is up 0.5%

5. Test rate is up at ASB

6. Which banks are offering loans to people with less than a 20% deposit.

7. Today's current interest rates.

And a whole lot of banter.

Enjoy!

It's taken us a while to realize that after 36 episodes we haven't done one on the benefits of using a mortgage broker instead of going directly to the bank for your mortgage.

There are a lot of benefits that we discuss within this episode but it comes down to a few key benefits;

- Advice; we teach you how to buy a house
- Personalisation; We know which bank and which products suit your situation best

- Ease of Use; Instead of you visiting each bank separately and explaining your situation we can do that for you

..and of course, it's free to use us and we will get you the same if not cheaper rates than what the bank offers you.

hello@tanta.co.nz to work with us. 

Did you know that the average first home buyer in 2021 put 49% of their household income towards their mortgage?

Back in 1949, the average house cost was only 2x the average household income. Now it's up to 10x.

So is now the worse time to be a first home buyer and should that stop you from buying?

We can't change the past; only learn from it.

And although that might speak true for the last 65 years, what about the next 65? Could right now be the best time in the next 65 years to buy?

We don't know.

So if you want a home and can afford it because the bank has said so.

Then you can either get your home now or "wait and see".

There are still people from 5 years ago "waiting and seeing" that would be a lot better off if they were brought back then.

Maybe you are thinking "You guys just want us to buy a home so you get paid"

Listen to the podcast to see if that is the case (it's not)

Kāinga Ora is great - if you meet their eligibility criteria for help.

In this episode, we discuss the three ways that Kāinga Ora can help you buy your first home.

- Home-Start Grant (that's up to $20,000 of free money towards your deposit)
- Shared Ownership ( you both own the property, they can contribute up to $200,000 for this)
- 5% Deposit Lending (they will lend you money to top up your deposit)

Each of these has its own rules so listen up and figure out which if any, can help you.

hello@tanta.co.nz

Right now, first-home buyers have got it tough.

And it's easy to blame that on the banks or the government which tells the banks what to do.

But instead of just complaining about it (don't worry we do that too); we wanted to give you a helping hand to use this tough time to your advantage.

Are banks making it harder for you?

Yes.

If you have a less than 20% deposit then you will be treated as a "risky borrower" and banks have been told to reduce the about of borrowing to this group.

But you can see why right?

They are protecting their business.

And to be fair if one of the major banks collapsed our economy would be in pretty horrible shape- so we don't want that.

But here is the good part;

If you are wanting to buy a new build and even if you have a 10% deposit then the policy rules are in your favor.

Plus you get a new build property.

Listen to Ant and I as we discuss and talk segways.

hello@tanta.co.nz if you need help :)

Having friends and family is great.

Especially when they can help you buy a home.

But how?

In this podcast, we cover three ways that your nearest & dearest can help you buy depending on if you need help with your deposit, the income side of things, or both.

These are
1. A guarantor
2. A Gift
3. More people

Ultimately everyone's situation is different and having a First Home Buyer Expert like us figure out your current situation and what needs to happen to get you into your first home is the next step forward.  hello@tanta.co.nz is that next step. 

We are hearing a lot of headlines about the struggles of builders, new builds, and the cost of living.

All this adds up to the end buyer to represent extra risk - that is an extra risk for you.

Is a new build still worth looking at for a first home purchase?

Yes!

But; you just need to be a little more careful with your due diligence. Not only on the land and the area and the plans but also on the builder and the developer.

So how do you do that? And what other things can you work on to help reduce this apparent risk?

Listen to Chris & I as we talk about
- How to find a good project
- Why banks are going to want you to buy a new build (and reward you for doing so)
- Sunset Clauses

And more..

Believe it or not - the buy now pay later facilities are debt and need to be treated as such when applying for a mortgage.

We see some people manage these well and others manage them not so well.

Like any debt, if you have too many and miss payments - it's unlikely you will be given a mortgage.

But if you are paying them on time then your chances are better.

The bank likes to see that you are living within your means. Spending money you actually have.

If you have all of these accounts are you managing your money wisely?

If you want to max out your borrowing capacity then all of these need to be paid off and closed.

If you are going to keep them open then they need to be put on the debt side of your application form.

Simple as that!

Or is it?

Chris & I recorded a podcast to summarize and explain what other things you should know about these tricky buggars. 

A lot of people tell us that they think the bank should give them a mortgage because they figured out that the repayments are around the same as their current rent payments.

However, it's not that simple.

The bank is going to give you 100,000's of $$$ so want to be pretty certain that you can pay it back.

This means that they test your mortgage at a higher interest rate (just in case), they add in other expenses, and still want to see you can save a bit of money.

So what can you actually do to show the bank you can afford a mortgage?

Listen to the podcast and it will tell you all of our secrets.

Questions? hello@tanta.co.nz

Inflation is up, so as a bid to control this the OCR is creeping up too.

What does this mean?

Higher interest rates on loans.

Mortgage costs are usually one of the biggest expenses in a household so by making a mortgage more expensive the theory is that people will have less spare money to spend on goods and services so the prices of those things don't go up as fast.

So how high will rates go and should you panic?

Historical data suggests the max will be a 1-year rate of 7%. However, this will only be temporary if it does go that high.

Should you wait to buy?

As long as you can afford a mortgage at that level of 7% (which is what the banks test your mortgage at) then you should be fine as long as your situation doesn't change dramatically (ie have a baby).

If the bank says "yes" then you should take comfort in the fact that the guys giving you money are confident you can pay it back, but what if you can't?

Even if you do miss a few mortgage payments it is an absolute last resort for your bank to take back your house and sell it as a mortgagee sale.

This podcast episode explains exactly what to look out for, and how you can make the most of the deals in this current buyers market.

Need help? hello@tanta.co.nz

If you are a first home buyer with less than a 20% deposit then this is something that you need to get during part of the due diligence process.

Today- Ant & I discuss what these are; when you need them and how long they will take.

Plus, what happens if the value comes back lower than the price of the house? Does that mean the purchase falls over? Or are there other options available?

Got questions? Reach out at hello@tanta.co.nz

A lot has happened in the last 7 days.

For most of us, the new war is so far away that we are not affected by it too much; apart from maybe the disbelief that war still can happen in 2022.

Regardless, the one thing that does react to overseas invasions is our investments and KiwiSaver balances.

You might have seen your balance drop; so what should you do? Change funds or ride the wave?

That depends on what you are using your Kiwisaver for and the timeframe that you think you will withdraw it.

Chris and I, coming from our new office in Takapuna talk about what you should do and what you should not do in these very interesting times.

And like always; if you need individual advice please email hello@tanta.co.nz