So you've made an offer and had it accepted - time to start cracking onto paying your deposit. This is one of the big financial steps you're going to take on your home-buying journey, so it pays to know what your options are going to be.
There are a few ways that you can arrange for a house deposit. If this is the first property that you're buying, then you may have more options than most.
You may be eligible for a KiwiSaver scheme first home withdrawal, or a KiwiSaver homestart grant. Depending on your bank, you could also be eligible for special lending targeted especially at new buyers, commonly called "welcome home" lending.
We've covered KiwiSaver withdrawals before here at Home Simple, and this is probably your most straightforward option. If you're a homebuyer who's contributed to your KiwiSaver for at least 3 years, then you'll be eligible to withdraw funds from your scheme provider. Regardless of whether you're getting your funds out under the KiwiSaver homestart grant or their first home withdrawal scheme, the time frame is about the same - 15 working days to access the funds you need. Make sure that you get on top of this process as soon as possible so that you aren't caught empty-handed on deposit day.
Another option entirely geared towards first home buyers is something provided by various specialist lenders. You may have heard them referred to as "welcome home" loans or "low deposit" options. This is a special sort of lending situation because your mortgage is insured through Kainga Ora.
If your financial assessment through your lender notes that you could make regular mortgage payments but are unable to get enough for a deposit together quickly, then a welcome home loan could be the option for you. You'll need to meet strict income-level requirements - $95,000 as a single buyer or $150,000 if you're buying with other people.
Financial providers like Kiwibank will also be able to advise you on other restrictions that accompany these welcome home loans, like house price caps. You could potentially be compromising on location if you choose to go with this sort of lending, but this is the trade-off for having to put up less of your own money early on in the purchase.
Depending on your circumstances, you've got a number of options when it comes to how to get your deposit together. You can always save the old-fashioned way, but if you're in a bit of a pickle then these paths in place for first home buyers could be a prudent choice as well. Think you might need a broker to help you get your finances straightened out before a purchase? Try out our handy finance quiz and we'll match you with someone who can assist.
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