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The pre first home loan health check

Here at My Mortgage we want to make your journey into your first home easy, and we've put together a brief "pre home loan health check" that we do every day with people like you to make sure they're in the best position they can be to buy.

Like visiting your doctor for a check up, there are a few key things that we need to get right so you're home-loan ready, and whether you're 6 months or three years from buying your first home, we can help guide you along the right path and make a plan together.

1. Income

Similar to eating the right foods and the positive effects this can have on your health, we'll look at your current income and this will form the basis of how much you can afford to borrow. Common things that a bank looks for here are time in position and industry (the longer the better), and consistency of hours across a week, fortnight or year to form your overall income. For some people, they might be looking to return to work after a baby, or starting a new business, and those things can also impact the amount and percentage of your borrowing.

​2. Current Debt

Whether you have a credit card you pay off every month or a car loan you're making payments on each week, we can explain the impact of the current debt you have on what you can borrow. If you want to borrow a higher percentage of the property's value (or have less than 20% deposit), current debt will need to be minimised as much as possible. We can help you make a plan to repay it, or to perhaps structure it a different way to help you pay less interest and pay it off quicker.

​3. Deposit

Whether this is Kiwisaver, Superannuation, Home Start Grant, Savings, Gifts from parents or family, inheritance, or a combination of some or all of these, we can help you set a budget to increase your deposit, as generally the higher the deposit, the less interest you'll pay. Check out our blog with some tips on how to increase your first home deposit here, and talk to us about the best option for you.

​4. Credit History

If you've made some mistakes in the past and your credit history isn't the best, please don't think all is lost. We'll explain the impact and how the banks will view this, and we can also help set a plan in place to repay it, or to show some long term commitment to making sure it never happens again.

​5. Account Conduct

This is a description of how you manage your bank accounts. A person or couple who always pays their bills on time and keeps their money in a simple and easy to manage method would be said to have good account conduct. Someone who has unnarranged overdraft fees or missed repayments for loans, or is constantly dipping into savings may be seen to have bad account conduct. Often if this is the case we can make a plan to manage things better. We'll have a chat about some ways you can improve this and after 3 months of consistent good management, we'll be able to show the bank you have made a commitment to buying a home and will manage your mortgage well in future.

Finally, we'll set out a plan together to achieve your goal of purchasing, and we may need to make some changes or tweaks to any or all of the above to make this happen.

Together we'll get you to where you want to be, so contact us today to find out how you can get yourself home-loan ready!

Adam, Claire and the My Mortgage Team