Mortgages
 

Hi everyone,

I am a New Zealand citizen and my wife has a permanent residency visa. Other than the obvious income requirements are there any restrictions to us taking out a mortgage when we move over to NZ? We’ll have copies of our U.K. credit reports with us and we will have a decent deposit.

Thanks.

Re: Mortgages
 

People that are not citizens or residents are not able to buy property in NZ but that does not sound like it will apply to you.

The Reserve Bank of New Zealand does apply Loan to Value rules on lenders. Currently a twenty per cent deposit is required for a residential mortgage on an existing home (more for property-investors). The banks do have some limited room for exceptions to that rule but it is easier for the bank to say yes if you don't need to be an exception. A lower deposit is required for a new-build.

Re: Mortgages
 

If you are interested in what mortgage you can get some of the banks do give you a pre-approval on a mortgage which is a no-obligations estimate of what they could lend.

Just as some forewarning however the housing market (or, more accurately, the market for developable zoned land) has been absolutely ferocious for the last 5 or so years, I think I heard the Reserve Bank of New Zealand forecast a 22.5% rate of increase in house prices over the next six months. Blink and you'll "miss out".

Re: Mortgages
 

I am unsure if UK credit ratings count in NZ. Our didn't for anything when we arrived but that was back in 2004.

AFAIK and remember the issuing of mortgages here will be dependent on your firm and known NZ income regardless of your deposit. It also takes into account any other debt that one may have i.e. credit card, hp etc.

There are several calculators to help you know what you might be allowed to borrow. Banks are being rather canny at the moment it seems. Self employed folk for instance are finding it almost impossible to borrow.

As an NZ citizen and PR there is no obstacle to you buying a home here , other than the high real estate prices and the limit on borrowing that might be in place.

Re: Mortgages
 

As you say you'll obs have to have evidence of adequate regular income. The bank providing or considering the mortgage loan will be interested in any debt you have and are paying regularly irrespective of interest rate....this includes things like Q Card, Gem Visa, purchases using Afterpay or similar system over a fixed period of weeks/fortnights etc. You have a legal obligation to declare all debt for all persons applying for the mortgage. Bank will also ask that you submit bank accounts so they can scrutinize where your money is going and ask questions if they see any unexplained routine payments. They'll wanna know about any regular payments going back overseas, e.g for a mortgage in the UK or to family, maybe child maintenance etc. Any credit you have on a visa card, or similar....even though you may not be using that credit is marked against you, effectively as a debt (because you have the ability to use it). If you have a number of credit cards that you don't use or other things where you have credit available to you then I'd advise you cancel and only retain the minimum credit you'll think required for emergency purposes....say $5k or so. The less credit you have available means the more money you can borrow for a mortgage. It is all about you being able to service the loan (or regularly pay it back). Having say $1k in available credit on a visa card may mean $10k less available to you on a mortgage.

Re: Mortgages
 

Your UK credit rating counts for nothing and they don't bother to check any previous history; provided you have a job and can show evidence of money being paid into your bank account regularly and a sizeable deposit (greater than 20% of the anticipated property value) then likely very few questions asked. Westpac however did insist that we had one of our salaries paid into a Westpac account in order to obtain their 'special' mortgage rate and I guess that's likely to be the case with other lenders.

Re: Mortgages
 

I think the more important thing is how your income will be. The bank cares more about your ability to repay the loan.

Re: Mortgages
 

Income and debt. If you have ,say, a car on HP etc then that will be taken into account.