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_**Please Note:** This newsletter was originally published on 15th September 2023. While the information presented here may still be valuable, some aspects may be outdated._

 

Spring has arrived, and with it comes the perfect opportunity to take the first steps towards your home ownership dreams. In this post, we'll teach you all about deposits, how to build them, how much you'll need for your home loan and what happens if you don't have enough?

Before you can step into the world of home ownership, it's essential to build a strong deposit. Here are some ways to piece together your deposit:

- **Cash Savings:** Saving a portion of your income over time.
- **KiwiSaver:**Utilising your KiwiSaver contributions for your first home purchase.
- **Kāinga Ora:** Explore government grants and loans through Kāinga Ora to boost your deposit.
- **Family Assistance:** Consider the support of family members, whether it's a loan or a gift.

For more information on building your deposit, or any other home loan related topics, explore our informative guides in Tella's Learn section [here](https://tella.co.nz/home-loans-mortgages/learn?). 

**Understanding Your Deposit Requirements**

The deposit requirements may seem complex, but we're here to simplify it for you. While some lenders may accept a 5% deposit for first home buyers, it’s common practice today to aim for at least a 10% deposit. A larger deposit not only opens doors to better loan options but also paints a responsible financial picture for lenders. Also, understanding your Loan to Value Ratio (LVR) is important, as it affects your interest rate. If your LVR exceeds 80%, you are likely to have a Low Equity Margin added on top of the standard interest rate.

**Starting Early: The Key to Your Success**

Kickstart your deposit journey as soon as possible. Banks consider your spending habits when assessing your loan application, so responsible financial behaviour is essential. Prepare a budget, closely monitor your expenses, and devise a savings plan that aligns with your goals. Going hard and being aggressive with repayments up front could save you thousands of dollars over the term of the loan.

**Why Prepare a Budget?**

A well-thought-out budget helps you:
- Keep track of your monthly income and expenses.
- Calculate how much you can save from each pay.
- Identify areas where you can reduce spending and increase your savings.
- Automate Your Savings

Make saving effortless by automating transfers from your income account to a dedicated savings account. This streamlined approach allows you to grow your deposit without the hassle of manual transfers.

At Tella, we're dedicated to helping you make informed decisions on your home ownership journey. Feel free to reach out for a free, no obligation chat with our mortgage experts.

[Book your call](https://calendly.com/tella-advisors/home-loan-expert-chat?) today, and let's make your home ownership dream a reality!

Adviser Hand Over Form (July 9th Upload).pdf

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Navigating the Deposit Journey

We're excited to announce the arrival of our newest member to the Tella family! 
Please join us in warmly welcoming Jose George as our newest Mortgage and KiwiSaver Financial Adviser.

**Expanded Services at Tella**

Many of you know Tella as your go-to source for expert home loan advice. We're excited to share that we've expanded our services to include comprehensive KiwiSaver guidance. With Jose on board, we can now help you navigate both your home ownership and long-term savings goals.

**Meet Jose George**

Jose brings a wealth of experience to the table, having served as the General Manager of Canstar New Zealand and with a strong background in banking. His expertise will be invaluable as we continue to provide exceptional service to our customers.

**KiwiSaver Expertise**

Whether you're looking to optimise your existing KiwiSaver plan or just starting your savings journey, Jose can help you:
Choose the right KiwiSaver provider based on your goals and risk tolerance.
Develop a personalised savings strategy to maximise your future financial security.
Understand how KiwiSaver contributions can work alongside your mortgage plans.
Accredited with Milford, Pathfinder, Kernal, and Generate, Jose has the expertise to advise on a wide range of KiwiSaver options.

**Get in Touch**

Looking to discuss your home loan and KiwiSaver goals in one convenient place? Jose is here to help! Reach out to him to schedule a free, no obligations chat here.

**Jose George**
 Mortgage and KiwiSaver Financial Adviser
 Email: jose@tella.co.nz
 Phone: 021 1405 293

Once again, a warm welcome to Jose! We're excited for him to share his knowledge and expertise with all of you. Please don't hesitate to reach out to Jose with any questions or to schedule a meeting.

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Tella gets the Canstar treatment

_**Please Note:** This newsletter was originally published on 21st May 2024. While the information presented here may still be valuable, some aspects may be outdated._
 


**Cash Bonus for Staying Put:**

Did you know you could potentially receive a cash bonus for simply keeping your mortgage with your current bank? This could be a great way to get a better deal with your bank (and cash in your pocket!), without actually having to refinance.

While the specifics vary by bank and loan size, the banks are offering up to 0.90% of the loan amount for new customers. For existing customers, it's typically around 0.50% to 0.70%, taking into account the fact that you avoid refinancing costs like legal fees or valuations by staying put.

Here are some client examples: Last week, three of our clients received cash bonuses of $3,100, $5,000, and $7,540 for staying with their current banks.

Think of it as a thank you for your loyalty, and an incentive to stay for another 3 years!

**How It Works (The Simple Version)**

The specifics can vary depending on the bank and your loan details, but here's the general idea:
If you've had your home loan with your current bank for 3+ years and are out of the original contribution timeframe, you might be eligible for a cash payment.
The amount typically isn't as high as new customer incentives, but it can still be a significant amount of money.
Best part? You don't have to deal with refinancing costs like legal fees or valuations.
Tella Wants to Help You Find Out

There is one bank out there pre-empting and offering upfront. Others you have to ask. So if you have been loyal to your current bank for 3-4 years now with your home loan, it wouldn't hurt to ask and have some extra cash in your account at the moment.

At Tella, we believe in informed decision-making when it comes to your home loan. Whether you're a new borrower or a loyal customer looking for the best deal, we can help you navigate the options.

We're happy to do the legwork for you and help you maximise your savings!

**P.S.** Remember, bank incentives and offers can change frequently. This email provides a general overview as of 20th May, 2024.

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Want free cash to stay with your bank?

_**Please Note:** This podcast was originally published on 13th May 2024. While the information presented here may still be valuable, some aspects may be outdated._

Today's episode covers:

- **Interest rates falling:** While you're not seeing this so much in published rates, negotiated rates continue to ease off. 
- **Cash is king:** Banks are all using cash incentives to both drive new business and also to hold existing customers. We don't see this very often and it shows the competitive nature of the market we're in. Now is not the time to just roll over your fixed-rate loan.
- **Auctions vs negotiated sales:** Auctions causing pain for first-home buyers with low deposits.
- **Creative agents:** Agents are getting creative with marketing costs to close the deal and get the sale done. 

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Falling interest rates and cash incentives

The news is in … Tella has just won a Canstar Innovation Excellence Award!

This means we’ve been recognised for providing a smart way to get mortgage advice in the digital age.

The Canstar judges gave us the nod for developing technology that transforms the old-fashioned and often-traumatic process of finding a home loan into something people can do online - easily, and on their own schedule.

Ready to see how our online mortgage platform combines one-to-one advice from a mortgage expert with user-friendly technology? Go to[ tella.co.nz](https://tella.co.nz/) or book a free call with an independent mortgage expert [here](https://calendly.com/tella-advisors/home-loan-expert-chat?).

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It’s official … we’re the most innovative way to get a mortgage

We're excited to share some incredible news! At the recent NZ Mortgage Awards, Tella didn't just walk away with one, but **two** prestigious awards!

**Double the Recognition for Innovation and Excellence**

Our amazing team was recognised for their dedication and innovation, bringing home two prestigious awards: Innovator of the Year and New Brokerage of the Year.  These awards validate our commitment to pushing boundaries with technology and providing exceptional service, solidifying our position as a leading player in the New Zealand mortgage industry.

**Experience the Award-Winning Difference with Tella**

Whether you're a first-time homebuyer, looking to refinance, or simply want to explore your mortgage options, Tella is here to help! We offer:
- Expert guidance every step of the way: Our team of qualified mortgage advisors provides personalised one-on-one support.
- Innovative Technology: User-friendly platform that simplifies mortgage comparison and application.
- A more empowering mortgage experience: We believe in transparency and providing you with the information you need to make informed decisions.

**Let's Make Your Homeownership Dreams a Reality**

Visit our website at [tella.co.nz](https://tella.co.nz/) or book a free consultation [here](https://calendly.com/tella-advisors/home-loan-expert-chat?) with one of our mortgage experts today! We're here to help you navigate the mortgage process with confidence.

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Double Award Winners at the NZ Mortgage Awards!

Are you keeping an eye on those 'special' interest rates your bank offers? Or if you’re a first-home buyer, are the rates you see online reflective of what you'll actually get? Let's dive into the world of bank interest rates, negotiation, and finding the best deal for your home loan.

Just like petrol stations adjust prices daily based on costs and exchange rates, banks also tweak interest rates regularly. While they might not update their website daily, you can often negotiate for better rates behind the scenes, especially during significant shifts like an OCR update.

But how do you know you're getting the best deal? It's not like you haggle over interest rates every day, right? This is where having an adviser comes in handy. They're plugged into the latest rate offerings, receiving weekly updates from banks, and can help you navigate through all the rates and offers.

Does a small rate difference matter? Absolutely! Let's crunch some numbers. Take a $500,000 home loan over 30 years. A 0.20% difference can save you $15 per week, adding up to $780 a year. Over the entire loan term, that's a whopping $23,400 in savings. And if you really want to get ahead and channel those savings back into your loan, you could shave off up to 18 months from your loan term, saving around $36,000.

Now, for first-time home buyers, understanding the intricacies of interest rates can be daunting. Factors like deposit size and the chosen bank can significantly impact the rates you're offered. Banks often apply Low Equity Margins or premiums for deposits less than 20%, which can catch you off guard if you're not prepared.

To understand more about bank fees and interest, visit our website [here](https://tella.co.nz/home-loans-mortgages/first-home-buyer/home-loan-mortgage-interest-fees). Our guide breaks down these charges, explaining what they are and what they're for, ensuring you're fully informed as you navigate through your homeownership journey.

**Ready to explore the best rates in the market?**

Simply email us at hello@tella.co.nz, with your bank name, and we'll provide you with the lowest rates we're seeing this week. Knowledge is power when it comes to securing your dream home, and we're here to arm you with the information you need.

Got questions or need assistance? Don't hesitate to reach out to our team. We're here to support you every step of the way.

Here's to finding the perfect home and securing the best possible home loan terms!

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Home Loan 'Special' Interest Rates

_**Please Note:** This newsletter was originally published on 8th January 2024. While the information presented here may still be valuable, some aspects may be outdated._

Achieving your homeownership goals begins with strategic planning. Here are some key steps to consider:

_**1. Budgeting Matters**_:

Keep a close eye on your spending and consider setting aside money each month in a separate account. Showing you’d have the income to cover essential expenses like rates and insurance can strengthen your position when applying for a home loan. Clearing credit card debts and discontinuing laybuys or afterpays is a smart move.

_**2. Assembling Your Team**_:

Engage with professionals who will be crucial to your journey:

_Home Loan Adviser / Mortgage Broker_:

Selecting the right professional is vital. Our advisers understand that not all homebuyers have the same needs. Whether you're building a home or working with a 5% deposit, our team guides you through various options, explaining why a particular bank suits your unique circumstances. It's worth noting that advisers are compensated by the banks when you secure your home, so there's no additional cost to you for the invaluable support they provide.

_Real Estate Agent_:

Beyond the traditional role, some agents go above and beyond. Collaborative agents can streamline your experience by showcasing homes from other agents’ listings, making your home search simpler.

Securing pre-approval and understanding your borrowing limit adds another layer of advantage. By reaching out to agents with this knowledge, you can inquire about upcoming listings in their area that may not have hit the market yet. This proactive approach positions you to be among the first to explore and potentially secure these yet-to-be-advertised homes. 

_Insurance Broker_:

Safeguard your investment by making sure you have comprehensive coverage. Going unconditional on a home is smoother when you've verified your insurance coverage with a trusted broker. Older homes, in particular, may raise concerns about past renovations to foundations, electrical, or plumbing. It's crucial to make sure you can get insurance!

You can typically secure insurance up to six weeks before settlement, so plan accordingly and factor it into your budget. By addressing insurance early in the process, your transition to homeownership will be much smoother.

_Solicitor / Conveyancer / Lawyer_:

Whether it's your first home, an investment, or a refinance, the essential service you'll need is conveyancing. You can opt for dedicated conveyancing firms or enlist the assistance of solicitors, often backed by Registered Legal Executives for extra support. Find someone you're comfortable with, as they play a crucial role as the intermediary between you, the vendor's solicitor, and the bank.

These professionals are your go-to for signing documents, transferring funds, updating titles, and managing council rates and water payments. Beyond being a service, they're a wealth of knowledge, ready to answer your questions. 

Consider discussing estate planning (will options) at the same time. Opt for firms with fixed prices, especially if you're a first home buyer with many questions.

While pre-approval doesn't require a solicitor/conveyancer, note their details when making an offer, as they'll review the agreement for you. If you're unsure where to start, we have preferred partners depending on where in the country you’re based.

_Building Inspector_:

In today's real estate landscape, a building report is often a legal or bank requirement. Just as you wouldn't buy a second-hand car without a mechanic's inspection, investing in a home – a more substantial asset – warrants similar scrutiny.

Inspectors go beyond the surface, checking foundations and roofing. Remember, these reports focus on issues, not the positives. Distinguish between minor maintenance and potential financial burdens, ensuring you grasp your home's true condition before finalising any deal.

_Accountant_:

For our self-employed individuals seeking pre-approval, it's crucial to plan ahead. If your financials are freshly completed, fantastic! If they're not, be prepared to provide them as soon as you can. Depending on the time of year or your financial cycle, forecast or management accounts may need to be prepared, adding an extra layer of time. Ensure you factor in this potential delay when working towards pre-approval. 

_Registered Valuer_:

When your deposit falls below 20% of the purchase price or you're acquiring a newly built or off-plan property without a title, a Registered Valuer becomes essential.

The good news? You don't have to search for one – your adviser or bank handles this, though it comes at your expense. With a standard turnaround time of approximately 6 business days, it's crucial to factor this into your timeline. For offers on a property, ensure a reasonable finance timeframe, considering the valuation process and subsequent bank review, which may take an additional day or three.

**Tailoring Your Team to Your Needs:**

Remember, not all these professionals may be required – it depends on your unique circumstances. Your journey to homeownership is as individual as you are.

**Start the Conversation:**

Not sure where to begin? Schedule a quick 15-minute chat [here](https://calendly.com/tella-advisors/home-loan-expert-chat?) to discuss your home ownership goals and aspirations. We're here to help you navigate the exciting journey ahead!

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Navigating Your Journey for Homeownership

_**Please Note:** This newsletter was originally published on 29th September 2023. While the information presented here may still be valuable, some aspects may be outdated._

Your deposit is sorted, but the amount the bank is telling you that you can borrow falls short of what's needed for a realistic shot at homeownership. Or perhaps you're already a homeowner looking to borrow more for renovations, but you're being told that your income isn't sufficient. It's a common dilemma, and you need a solution.

Now, before you consider asking for a raise, taking up a second job, or starting a side hustle (keep in mind that you'll generally need these additional income sources for at least a year to meet the bank's criteria), let's take a different approach. How about focusing on reducing your expenses?

Your bank statements reflect your monthly spending, and it’s no secret the banks review these. However, most banks often use the national average to estimate expenses. So, what changes can you make to improve your situation?

I'll break it down for you, but be warned, we'll dive into some numbers here.

If you have a **credit card, store card**, or any old overdraft account still open, it could be affecting the amount you can borrow. Even if you don't max out these cards or pay them off in full each month, they're still considered to be used to their maximum limit because they're available for use. 

Typically, this is seen as an cost equivalent to 4% of the limit. So, a $1,000 credit limit translates to a $40 monthly cost. You might think it's not much, but consider if you have multiple cards, like a GEM Card, Farmers Card, Mastercard, and Visa for a total limit of $10,000 or even $15,000. That's a $400 per month 'expense'. 
Still doesn't sound significant? Well, with $400 a month, you could pay off a $60,000 home loan over 30 years. Let that sink in - $400 a month can make a huge difference in the long run.

Basically, that $10,000 in credit card limits could be limiting how much you can borrow by a factor of six. The solution? Repay and close down those cards to increase your borrowing capacity, or reduce the limits if you're not actively using them.

But what if you need these cards for online bookings or travel, and the current limit won't suffice? Well, you can also load money onto them to purchase more expensive items and still earn rewards or points your credit card offers.

Now, let's talk about **Laybuys and Afterpay**. These can impact the amount you can borrow too, depending on the product. Sometimes it's the limit you have, other times it's the average of your monthly repayments. They might not seem like a big deal, but if you're paying $100 a month on these, they could be the obstacle preventing you from securing that extra $15,000 needed for home renovations. Don't let a small expense become the deciding factor for your kitchen or bathroom makeover.

**Personal loans and car loans** are quite common, often costing $400 a month or more. Even if you have just a few months left to pay, these payments will be factored into your borrowing amount. It's worth focusing on paying them off.

Now, let's talk about student loans; this one's a bit different and more personal. If 10% of your income goes towards repaying your student loan, that money could cover a significant portion of your home loan instead. While it may not always be feasible, for first-time homebuyers, if your student loan balance is low enough, it might be worth considering using your savings to pay it off and have a lower deposit for your home (making sure you still have the minimum deposit needed).

So, is it really your income, or are these perceived 'bank expenses' the main obstacle holding you back from getting that little bit more you need?

If you're looking to see how much you can increase your borrowing power by, don't hesitate to book a [free, no-obligation call](https://calendly.com/tella-advisors/home-loan-expert-chat?) with a Tella mortgage expert today.

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Reducing Perceived Expenses for Homeownership Success

_**Please Note:** This video was originally published on 7th June 2022. While the information presented here may still be valuable, some aspects may be outdated._

 

Before buying your first home you'll need to save for a deposit. This Tella video guide covers what you need to know before you start saving. What can you afford to spend on a home and how much the bank will lend? It covers using KiwiSaver, Kainga Ora, and loans or gifts from parents. For the first home, we always want to make our deposit go far so it's important we cover off low deposit (low equity) loans and what this means in terms of cost. Take 5 minutes to get yourself up to speed before using some of the great calculators and guides on the Tella website.

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Saving for a home loan deposit

_**Please Note:** This video was originally published on 7th July 2022. While the information presented here may still be valuable, some aspects may be outdated._

Why might you want to switch your home loan provider and what should you consider when doing so? In this video Ben will walk you through all you need to know and consider when refinancing your home loan.

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Make the SWITCH to improve your banking

_**Please Note:** This video was originally published on 23rd September 2023. While the information presented here may still be valuable, some aspects may be outdated._

There's a lot to consider when it comes to refinancing your mortgage so in this free webinar we've got Ben and Andrew from Tella, along with Sarah from the One Up Project sitting down to chat about all things refinancing. They'll cover the answers to common questions such as: 

* Why might you refinance?
* How might the current environment around interest rates and cost of living affect this decision? 
* Are there financial benefits to refinancing? Cash incentives? Costs of refinancing? 
* How will my lifestyle changes affect refinancing. 
* What’s involved in refinancing? and 
* What tools does Tella have available to help me make an informed decision? 

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Don't just roll-over! Refinance your mortgage.

_**Please Note:** This video was originally published on 2nd September 2022. While the information presented here may still be valuable, some aspects may be outdated._

 

🏡 Attention NZ Resident Visa Holders: Buying Your Dream Home is Possible! 💫

Have you been told that purchasing a home on a NZ resident visa isn't possible? We're here to dispel that myth – because you CAN make your homeownership dreams a reality!

Discover how to navigate the process and secure the house you've always wanted with our simple guide.

For personalised guidance on your home loan journey, reach out to us at hello@tella.co.nz, and our friendly team will be happy to assist you every step of the way. 📧🔑

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How to buy your dream home on a New Zealand Residence Visa

_**Please Note:** This newsletter was originally published on 10th March 2023. While the information presented here may still be valuable, some aspects may be outdated._

If you’re looking to buy your first home this year, conditions are more favourable than they have been for some time. And now there’s another helping hand available in the form of the Kāinga Ora First Home Partner scheme. In this newsletter we run you through what’s involved in this new co-ownership offering.

We also assess the landscape for those already on the property ladder, because 2023 will see many of you re-fixing your home loans as current fixed terms expire.

This will likely be a shock to the system (and wallet) with rates, and therefore repayment amounts, significantly higher than they were at the start of your term. It’s crucial to make the right choice when you re-fix as you’ll be locked into higher rates for a while.

What’s the best strategy now, and for how long should you re-fix? We look at some of the options you have to manage this new interest rates environment.

**Kāinga Ora First Home Partner**

As property prices fall across the country, lenders and real estate agents are reporting more first home buyers entering the market. CoreLogic data shows that a quarter of properties sold now are to first home buyers, which is a new record.

With investors still hamstrung by a 40% deposit requirement, it’s a great time to get on the property ladder if you can.

But what if you still have a shortfall between your deposit, the amount a bank will lend you, and the price of the home you want to buy? In a situation like this, Kāinga Ora’s new First Home Partner scheme could be an option.

Designed specifically for first home buyers, the scheme operates as a shared (or co) ownership model, with you as the majority homeowner and Kāinga Ora as a third-party shared owner of a property.

**So how does it work?**

Kāinga Ora will contribute a certain amount towards the price of your property (up to a maximum of 25% or $200,000 – whichever is lower), giving them an equivalent ownership share.

So, if you have a 5% deposit for the house you want to buy, and a bank is willing to lend you 75%, Kāinga Ora would fund the remaining 20% of the property price (giving them a 20% ownership stake).

You then agree to pay that 20% back to them until you’re the sole homeowner.

You’ll be responsible for any costs associated with the purchase, such as legal and conveyancing fees, and you’re also in charge of all the ongoing property ownership costs including rates, insurances and maintenance.

Kāinga Ora won’t occupy your home, or tell you what to hang on the walls, but they will have some say as a shared owner. Keep in mind that you’ll need their approval for any major renovation projects as a guard against over-capitalising on the property.

See our new [guide](https://tella.co.nz/home-loans-mortgages/first-home-buyer/kiwisaver-first-home-grant) for more details on the eligibility criteria and finer details of the First Home Partner scheme.

**Need to re-fix this year?**

If you need to re-fix your home loan this year, you’re not alone.

The Reserve Bank says that between October last year and September 2023, nearly half of Kiwis’ home loan debt is due to be re-fixed.

With uncertainty around rising interest rates, inflation, and cost of living increases, here at Tella we’re seeing lots of questions from homeowners who want to know what’s the correct strategy when it comes to re-fixing their home loans.

Is it better to go for certainty by locking in for a longer term such as 5 years? Or fix for 1 year and take the risk that interest rates will be in a better place 12 months from now when you need to fix again?

The answer is that the correct strategy is always the one tailored to your individual circumstances. And takes your plans for the next few years into account.

Typically, a 1-year fixed rate is the cheapest rate option, but NZ’s big 4 banks are currently pricing their 2-year fixed rates lower than their 1-year offering.

This is partially to do with competition amongst lenders. They all want your home loan business and are trying to make it attractive for you to switch (and then stay). Longer term rates (3-5 years) are also being priced lower than the 12-month options.

However, with most economists predicting rates to ease again from the end of 2023, there may be higher risk to you in fixing for a longer term, than a shorter one.

An important question to consider, along with individual rates and terms is: how ready are you to ride out your future interest rate jump?

Although higher rates are going to hurt, the comforting news is that lenders already factored in any potential rate rises when they assessed your home loan application. Their modelling stress-tested your ability to service their loan at higher rates, and concluded it was achievable.

But on the flip-side of this, any money you had earmarked for other purchases or activities will now go toward servicing your home loan for the period of your new term.

Get ahead of the rise now. Crunch your household budget. Reduce as much discretionary spend as you can. Also try to clear any outstanding debt (particularly high-interest credit card debt) to ease the pressure on your pay packet.

Those homeowners who are currently paying off more than the required fortnightly or monthly amount to pay down their principal more quickly, could look at temporarily dropping it back to only the amount required. This would shrink the gap between their current and higher re-fixed loan repayments.

Compare the latest interest rates for over 20 lenders [here](https://tella.co.nz/home-loans-mortgages/rates), or to us now to get the best deal when re-fixing this year. Our experienced Home Loan Specialists are available on 0800 4 TELLA (0800 4 83552). They’re here to guide you through these interest rate rises and will structure the best home loan option for you.

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 Refix your interest rate with confidence

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