Low Deposit Welcome Home Loans For Apartments Just Got Easier
It makes sense for first home buyers to look at buying an apartment, but it has always been more difficult to get low deposit home loans for apartments.
That has recently changed.
Getting home loans for apartments has just got easier.
Updated Welcome Home Loan Criteria For Apartments
Housing NZ has recently changed their Welcome Home Loan criteria for apartment purchases.
Previously it was required for the apartment to have its own ground floor access which meant most apartments did not qualify – THIS REQUIREMENT HAS NOW BEEN REMOVED.
Now each stratum in freehold property must meet the following criteria:
- Minimum floor size of 50 square metres, excluding balcony, carpark, garage, external stairs and any common area;
- Self-contained – no shared facilities such as kitchens, bathrooms and laundry;
- Must be stratum freehold, NOT Stratum leasehold;
- Must be purpose built for owner-occupation (not converted apartments);
- To mitigate concentration risk, Housing NZ will limit its exposure to no more than 40% of units in any stratum in a freehold complex. This is to be controlled at point of application; and
- Property to meet the bank’s own requirements in regards to seismic strength and weather tightness.
This means more apartments will fit the criteria for a low deposit Welcome Home Loan and that is some positive news for those first home buyers that meet the criteria.
CLICK HERE to check if you are eligible.
Not All Banks Offer Welcome Home Loans
A lot of first home buyers think that the bank they have their accounts or KiwiSaver with will be the best people to ask about a home loan.
Of course, the banks themselves encourage this way of thinking.
When you apply for a home loan it actually does not matter who you have been banking with, or where you have your KiwiSaver. The banks are all quite competitive and will assess your home loan application.
If you go directly to your bank you might be limiting your home loan options as many banks do not even offer Welcome Home Loans.
Talk To The Experts
Typically in Auckland it has been hard to use Welcome Home Loans as there has been a house cap of $600,000 for existing houses and $650,000 for new houses. With the property market in Auckland it has been hard to find good homes that were below these price caps, and while most apartments fit the price cap they were not deemed as suitable because they generally had no ground floor access.
It can be daunting when buying your first home and that is where the advice of a mortgage broker can be very helpful. In the past sourcing low deposit home loans for apartments was difficult as the banks were not too keen on them and a Welcome Home Loan excluded most of the apartments. Now it has become easier and you might also be eligible for a HomeStart Grant too.
Good mortgage brokers know the various options, and a Welcome Home Loan might now be a good one if you are buying an apartment as your first home.
The post Low Deposit Welcome Home Loans For Apartments Just Got Easier appeared first on The Mortgage Supply Company.
Source: North West Mortgages