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Guide For Applying First Home Loan

At The Blueprint, our experts recommend that the first home buyers must be well informed before applying for a mortgage. The home loan process often becomes frustrating due to several terms & conditions and unawareness of the buyer.

Know what you should do for a home loan application:

You can follow these easy steps to apply for a home loan:

1.Meet with a Loan Market Mortgage Broker:

Meeting with a mortgage broker is the first step to start your home loan application process. A mortgage broker will suggest the best features and interest rate that can be helpful in choosing a suitable loan as per your financial needs.

Here are some decisive points that you should confirm before meeting with your Approved Mortgage Broker:

  • You need to meet the specific loan criteria of the lenders.
  • You must have the citizenship of New Zealand or must have a permanent resident visa.
  • You may need to pay an application fee.
  • You need to show 3 months bank statements to ensure that there is no history of dishonoured cheques or payments.
  • Confirmation of your deposit (Savings account statements, term deposit certificates and investment statements etc.)
Once the process of loan application will be started it may take one or two months for approval

2.Important Documents/Evidence For Loan Application:

When applying for a home loan, you will be asked for some documents that will be necessary for the Loan Application. Here is the list of Documents that may be required for Loan Application:

  • Proof of citizenship (Passport/Visa/Citizenship Certificate, Drivers License, Marriage certificate, Birth Certificate etc.)
  • If you are an employee, two most recent payslips and copy of employment contract and/or a letter from your employer
  • If self-employed, last two years full tax returns
  • WINZ Statements
  • Proof of existing or proposed rental income
  • Statement for all savings accounts
  • Rates notice on any existing properties
  • Recent statement of all credit cards, personal loans, leases etc.
  • If there any existing mortgages, copy of loan statements for 6 months
  • A copy of “Contract of sale” for the property being purchased
  • Home Insurance certificate for all existing properties 
  • Copy of plans and fixed price contract for any construction
3.Assessment by the Lender:

In this process, the lender or representative of the lender assesses the application and supporting documents to determine whether the applicant meets their requirement or not. It also includes confirmation of income and employment and credit report checking.

4.Underwriting Approval:  

Before offering  approval for a home loan, the lender will offer you a conditional approval and your mortgage broker will receive this approval on your behalf. In this approval, lender may ask for some additional information that needs to be confirmed before final approval.

5.Property valuation report for Security:

Lender may require a valuation report of the property being purchased. Your mortgage broker can arrange a valuation on your behalf. The cost of valuation will be paid from your side. 

6.LMI (Lender Mortgage Insurance):  

Usually, lenders require borrowers to have at least a 20% deposit of the purchase price, but the lender mortgage insurance allows borrowers to borrow up to 95% of the purchase price of the home.

7.Final Approval:

Once all the formalities is done, a formal Letter of full (unconditional) approval of the loan will be issued by the lender.

8.Loan Settlement & Insurance:

After receiving the loan documents, your solicitor will coordinate with the lender to schedule a settlement date. Usually the first payment of the loan is scheduled after the first month of the settlement date. There are some insurances like life/income protection & home and contents insurance that you may need to start prior to settlement.

9. The Closing:

If all the above mentioned steps have been followed this should be the most stress-free time. Review the loan papers carefully, once you have signed these papers, the loan process will be completed.

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