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What other costs are there to buying a home?

Aside from the major expense of actually paying for the house and land you're buying there are a number of other costs associated with buying a home. We have outlined the most common costs below.

Before we get in to the list I'd just like to remind you that my service is free. The banks pay me to provide advice on their products and to arrange for the lending of their funds. I'll find you the best option from a range of NZ's best lenders.

It's also worth noting that I will negotiate the best possible "cash back" deal from the bank you go with. Depending on the strength of your application and how much you're borrowing this can vary but generally starts at $1000 for as standard loan and can go up from there. I'll negotiate to get the best possible deal for you.

​ Builders Report

Not everyone will get one of these but it's always better to be safe than sorry. A builders report will point out any potential issues with the property or highlight potential maintenance that needs to be done to keep the property up to a high standard. Reports vary from an external visual inspection to as far as moisture testing the internal framing. Costs generally vary from $100 to $500.

LIM Report

LIM reports are an essential part of buying a property for most people and your lawyer will recommend the best course of action in regard to this.  The LIM provides the information that the council has on the property you are buying, information which can be invaluable when it comes to consents etc.  The cost of a LIM report varies depending on the council and how quickly you want it.  Expect this to cost you around $150 - $300.

​ Registered Valuation

A Registered Valuation is explained in more detail on the "Helpful Videos" page.  This independent report is generally required when you are borrowing more than 80% of the value of a property or building a new dwelling.  They are not generally required otherwise and I can advise whether a Registered Valuation is required for your purchase or not.  The cost of a valuation varies but generally is between $450 - $600.

Legal fees

This is the major cost when purchasing a home.  For a standard purchase a lawyer generally charges somewhere between $1000 and $1500 for the work they do. This includes checking over the contract to purchase, providing advice and registering the new mortgage among other things.   

Another cost that is usually included with your legal bill is paying your share of the council rates. Most people pay these quarterly so if you buy in the middle of a quarter you'll have to repay the previous owner for the rates they have paid up until the next due date. This can vary from $1 to a few hundred dollars depending on where your settlement falls in the rates cycle.

As you can see, you may not incur every cost and there are often ways of going about your purchase which will allow you to minimize the cost of these extras.  Either myself or your lawyer can advise you on what is required specific to your situation.

If there are any other potential costs that you would like us to cover or if you have any questions on the above just let us know.

Adam and the My Mortgage team


 

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