Cracking the first home code
Buying your first home doesn’t have to be confusing. Brooke Reynolds from Rapson Loans and Finance says there are more loan options available than most people realise. With the right advice, you can find a solution that fits your budget, deposit size, and property goals.
Buying your first home doesn’t have to be confusing. Brooke Reynolds from Rapson Loans and Finance says there are more loan options available than most people realise. With the right advice, you can find a solution that fits your budget, deposit size, and property goals.
If you're a first-home buyer, you might be surprised by how many loan options are actually available to you. It’s not just one-size-fits-all.
Here are three main types of loans to consider, along with how each one works:
1. First Home Loan (via Kāinga Ora)
Some banks offer First Home Loans in partnership with Kāinga Ora. The bank handles the initial assessment using its own lending policies, and then Kāinga Ora gives final approval for both the loan and the property you're looking to buy.
It’s important to note that just because Kāinga Ora gives the green light doesn’t mean the terms, such as how much you can borrow or the interest rate, will be the same across all banks. These can vary depending on the lender.
The minimum deposit is five percent, and the deposit can come from personal savings, a gift, or proceeds from selling an asset. Not that you’ll need to meet Kāinga Ora’s eligibility criteria, which can be found at kaingaora.govt.nz
2. 10% Deposit Home Loans
These are widely available through all major banks. While banks may pause pre-approvals based on application volumes, you can still proceed by making an offer on a property. Once your offer is accepted, the application becomes a live deal and can be assessed. Some lenders still offer pre-approvals for auction purchases. The minimum deposit is 10 percent, and at least five percent must be from genuine savings (e.g. KiwiSaver, cash savings, investment funds, or sale of an asset).
The remaining five percent can come from a gift or a deed of debt from family. Bank rates vary between lenders, however the rate will be higher than a 20 percent deposit loan. Some banks may offer a $5,000 cash-back for first-home buyers.
3. 5% Deposit Loan (Non–Kāinga Ora)
There’s at least one bank offering five percent deposit loans for borrowers who don’t meet Kāinga Ora’s criteria. This loan requires genuine savings for the full five percent deposit. Pre-approvals are not offered, but live deals (including auction purchases) will be assessed. Availability is subject to bank capacity – some may pause new applications from customers not already with the bank.
Important to note for all loan types
A professional property valuation is required for all three loan types. Make sure your offer includes enough time for both the assessment and valuation. These loans are not available on interest-only terms – you’ll need to make principal and interest repayments from the start. Navigating your first home loan can feel overwhelming, but a trusted mortgage adviser can guide you through the process. Ideally, choose one with access to all lenders, as borrowing limits and interest rates vary significantly between banks.
Transform tomorrow
Facing a health scare without any insurance cover in place motivated Diana McIntyre to become an insurance specialist with Rapson Loans & Finance, to help others avoid the same shock.
Facing a health scare without any insurance cover in place motivated Diana McIntyre to become an insurance specialist with Rapson Loans & Finance, to help others avoid the same shock.
Life can throw you curveballs. When my brother died suddenly, his foresight in taking out life insurance saved our family from financial heartache on top of grief. But when I faced my own health crisis, I did so as a solo mum and breadwinner, with nothing to protect my financial security.
Many Kiwis insure their homes and vehicles but we are much more reluctant to insure our most valuable asset – ourselves. I now know that health, trauma and income protection insurance can literally save the day.
A good health insurance policy will give you access to non-Pharmac drugs without having to sell your home or beg others for help via Givealittle. And it will ensure you are seen quickly without languishing on public waiting lists while your condition worsens.
According to Health New Zealand / Te Whatu Ora, 180,000 people were waiting for a first specialist appointment last December – and 68,000 of those had waited longer than the 40-day target. New Zealand’s health system is overloaded and focused on critical need. But you don’t have to be critically unwell to be debilitated.
I am privileged to work with clients every day to cover their risks while balancing their budget. A solo mum in her late 30s was recently diagnosed with breast cancer. As her household’s only financial provider, her $100,000 trauma cover financially saved her.
Another local couple in their 40s, with children from previous relationships, took out a joint life insurance policy. Less than 12 months later, he died. But the insurance payout meant his new partner could continue living in their home, and his children received an inheritance.
While no-one likes to think this could happen to them, the reality is it could. In today’s economy, I can help you sustainably manage your premiums. If you’re under 45, it’s worth taking out some ‘level’ of trauma or life cover which won’t increase each year in line with your age. It will give you more certainty on cost and help you plan for the future.
Once you’re over 50, right when you’re likely to need cover, your premiums will be sustainable. If you’re older, you could consider increasing your health insurance excess if you need to reduce your monthly premium.
My best advice is to sit down with a knowledgeable insurance specialist such as myself. I can take a holistic and pragmatic look at your circumstances and help you strike the right balance between cover and cost.
It’s important to set up insurance that meets your needs now, as well as strategically looking ahead to the future.