The reasons to refinance your mortgage
Refinancing is defined as the process of replacing an existing mortgage with a new one. This can be with your current bank or you may want to switch to another bank. It is the process of restructuring or reorganizing, your loan to ensure you have the combination of fixed and floating terms that work best for your individual situation. If you are looking for best rates or easy way to pay off your loan, mortgage refinancing can be best option to do. Most of brokers or banks offer special deal for refinancing your loans. It can be good idea to do bit research while choosing best provider. The desire to refinance a home or business loan varies from individual to individual but there are common reasons:
You are wanting to save on interest costs.
If you think your bank is not offering the best deal on interest rates you may what to seeking a lower interest rate with another bank. This will help you pay off your loan sooner if you maintain your current level of repayments.
You want to reduce your fortnightly or monthly installments due to a change in your financial situation.
This provides more money into your household budget, however, the term of the loan will need to be extended. This, however, means your loan will now take longer to pay off and your interest costs will be greater than those of your original loan.
You want a shorter loan term.
This is known as restructuring and once set up allows you to pay off your loan more quickly saving you thousands in interest costs. This is achieved by structuring the right combination of fixed and floating interest rates for your loan.
You want to access new loan features.
These could be credit cards available at home loan interest rates or combining balances into an offset account. If these features are not offered by your current bank, by switching to a new bank with them, you could save money on interest payments.
Your current bank has declined an application.
You may have applied for an additional loan from your bank, for example, for the purchase of an investment property but you bank won’t approve another loan. Each bank has their own lending criteria, so another bank may be willing to provide additional funding.
You want to consolidate debts.
If you have a number of loans, such as one for your home, another for a car, a hire purchase and a credit card, you might want to consolidate these loans or debts into a single loan at a lower rate of interest.
Poor service from your current bank
You may not be receiving the service from your bank you expect, so it’s time to change!
While the thought of changing a bank appears daunting, banks are keen to accept new customers and make the welcoming, or on-boarding process as easy as possible. If you are refinancing a loan with a new bank you will usually need to open a new transaction account with them to accept your salary or wage payments.
When you refinance, what changes, and what doesn’t?
Installments: when you refinance your regular installments, or repayments, will change as you now have a brand-new loan with repayments calculated on new terms and interest rates. In order to help with budgeting, it’s important to understand what these changes will be before you accept a refinancing proposal.
Outstanding Debt: Your loan balance will not change, so you’ll still have to pay-off the same amount of the loan you had with a previous bank – unless you have taken on more debt when refinancing.
Even if you’re not sure whether you need to refinance your current home or business loan, it is advisable to complete a regular review of your mortgage, and your current financial situation, with Global Finance. When it comes to loans, we have handled just about every type of scenario over the last 19 years. Our experience allows us to negotiate with banks on your behalf to find you the best deal, and, you don’t have to be a current customer to use our expertise and services.
We look forward to helping you with your refinancing requirements, so call us on 09 255 5500.
How to Pay Off Home Loan Faster in New Zealand?
Best way to pay off the loan is one of the top questions, people normally ask fina financial adviser. It is really hard to answer straightforward without knowing his or her financial circumstances. Many people find themselves in financial difficulty when paying off their home loans. It is essential for you to know how to save cash and clear off your mortgage faster. Recently, we meet to Ajay Kumar and ask this question. Ajay Kumar is a director of Global Financial Services. According to recent awards, they are one of the leading mortgage brokers agency in Auckland, New Zealand. Ajay told us, “The simplest way of paying off your loan quickly is to make regular loan repayments which are higher than standard 30-year loan repayments you make, so each loan repayment reduces your borrowed loan amount quicker.” The starting point for a quick repayment plan is to analyze your budget.Your budget will offer you a fantastic measuring tool for your current position as well as your future. You can use these tips to enable you to settle your house debt.
Check out best ways to pay off a loan faster in New Zealand :
Extra payments
It is very important & handy way to pay off faster. If can do some extra saving, just pay bit extra loan payment. You should make small, regular addition payments. With time, these small amounts of money will all add up to a significant amount. By squeezing a little cash from your monthly earnings, you can add it to your loan repayment to ensure that you clear it off sooner.
Higher repayments
I understand that it is hard to pay higher repayments. However, if you organize your lifestyle, you might be capable to repayments bit higher. Set your monthly loan repayment limit higher than your bank’s minimum monthly installment. If you have a long variable mortgage, you’ll realize that your repayments have dramatically reduced. If you continue to repay the same amount for about two years, you would be better on your way to clear the mortgage.
Adopt a saving strategy
Many financial analysts claim that adopting a good saving strategy can be the best way to pay off a loan faster. Owning a home is a great project that needs the family head and even members to save and pool together their funds settle the loan fast. Your family can contribute by saving on household expenses or energy consumption which they can add to their home loan payment.
Have an offset account for your home loan
You should ensure that you operate your offset account for your home loan. There’s no any other place for interest to channel this money into your home mortgage, the amount of cash you will save upon clearing your credit off earlier can be many thousands.
Introduce lump sum tips
Have some occasional lump sum payments to finance your mortgage. When you earn a bonus from your workplace, get a tax refund or even a little inheritance, these savings can reduce your loan balance and save much on interest. In New Zealand, most mortgage brokers agency help you out to introduce lump sum tips for paying loan quicker.
Loan review by a mortgage broker
It can be the best way. If you re-structure your re-fix you loan, you might get a good way to repay loan quicker. Find your mortgage broker. Your living conditions when you were buying the home may be different and may need to review the contract to fit your current situation. For example, you may want to set a fixed rate or split your loan, or maybe you’ve recently had a kid and shifted to a single income, perhaps you got another job with a higher earning capacity.All of them affects your mortgage repayment schedules.
Dedicate yourself towards loan repayment
Moving from monthly to fortnight repayment patterns is the most effective mortgage reduction strategy, by paying this way you will make a total of thirteen monthly installments over a year, resulting to one month’s other payment every year.
Refinance your loan
Another fantastic way is to refinance your mortgage using a cheaper lender. If your current lender charges 6% interest, you can refinance with another lender, for example, a lender who charges 5% interest to refinance your mortgage. Also, when you consider renewing your loan, you may be able to benefit from the lower interest rate, thus saving some money.
According to our recent research, we found 35% New Zealander are struggling to repay their loans quicker. There are many reasons behind that. In this blog, I am going to point out some common mistakes while repaying mortgage mistakes.
Some Mistakes you may make when repaying your mortgage include:
Ignoring your credit Score –This rates your creditworthiness to indicate your trustworthiness for the banks in loan matters. If you maintain a good score by honoring your contract while repaying your mortgage, it will give you favorable deals when negotiating for better loan terms. You must take care of your credit score. If you face lower credit score, you may work out to improve bit higher. According to expert, above 700 out of 1000 can be good credit score
Applying for extra Loans -By simultaneously taking other loans while repaying your home mortgage, for example, personal loans will make you look ‘Credit Hungry’ and banks will blacklist you as a financial risk. If you want to pay your loan, you may try to refinance options. Most of the Banks or private lenders allow refinancing your existing mortgage or home loans.
Failure to plan –Many borrowers may set their monthly home loan installments higher that they cannot after considering their income and expenses. It is advisable to budget yourself financially before deciding your repayment amounts.
Inconsistency in repayment patterns- Sometimes borrowers may fail to pay off some of their monthly installments which can be very dangerous as its one way of bridging your contract and can lead to unfavorable consequences.
Late payments –In some cases, some borrowers are not keen on the payment schedule as they don’t usually have good strategy always to remember their repayment date.If possible, you can include this date in your diary to ensure you pay on time.
What need to do while applying for construction loans in NZ?
Construction loans are very popular lending options to real estate agency or individual builder. In New Zealand, there are many banks and non-banking organization offer construction loans in NZ. Most of the lenders have different types of terms and policies. So, it is very important to look for best lender while borrowing money. When building a home, waiting for loans to come through can be a cause of stress and worry. During construction, safety with money is essential as well as efficiency in project planning. Here are a few tips to get your construction loans through as fast as possible, as well as some things to avoid.
1. Online Service:
Do: Applying for loans online is now easier than ever. Most major banking websites will have customer service links, whether this is to an online application form or to a live chat. Customers of these banks will be able to access information directly and easily while others may have to go through a few more formalities. In New Zealand, most of the banks and non-banking firms may allow the online application. If you busy with tight work schedule, you may apply online and have chat over the phone.
Don’t Do: When applying online, make sure to utilize all the websites capabilities. Online chats are often the best option instead of phones, at least for initial points of contact and conversation. Furthermore, plan what you need from the customer service team, as they will not be able to help you efficiently unless they know what you want. Most importantly, you should be very careful while inserting sensitive data.
2. Know How Much You Can Borrow:
Do: Make sure to check and how much you can actually borrow. For a top-up loan, it can be up to 90% of your home’s value, and a similar amount for major construction, less for pure labor costs. It is understandable that banks & non-bank organization will allow you the certain amount of money based on your earning & savings. You should contact 3 or 4 lenders regarding eligible loans amount.
Don’t Do: Don’t estimate how much you need or how much you think you’ll be able to borrow. You will need to get a few different valuations, which may seem tedious, but is worth it to assure accurate information is processed quickly.
3. Know Where Your Loan Will Go:
Do: It is important to realize that your construction loan will go directly to the builder rather than to you. This is so construction starts as soon as possible. Sometimes people prefer to get money in their personal account and it may take a bit more time for processing money.
Don’t Do: Don’t panic if you don’t see the loan going into your account, and do not confuse things by contacting the bank. Be in contact with your builder at all times concerning financial details. I should suggest finding a local reputed builder.
4. Understand How Construction Loans Are Paid
Do: It is imperative to realize that construction loans are paid out in stages. The stages are usually specified in the contract with the builder, which needs to be certified at precise points to assure the correct work has been done. The builder should finish developing work on time and it might save your less interest for building loans.
Don’t do: Do not expect all the loan money to be at your disposal. For your own protection, it is paid out to the builder by activity, assuring the construction is kept up to value. I personally recommend having mortgage protection insurance. It might save your finance if you face any uncertain financial crisis.
5. Learn About Your Interest Rates:
Do: Understand the interest you will be paying on loans already delivered. Usually, construction loans are on floating interest rates, which can increase or decrease depending on the market and on construction. In New Zealand, you may get many banks and non-bank options for lending constructions loans. It is very important to do bit research for best interest rates. I personally recommend having brokers, if you are comfortable to work with financial brokers. They mostly know latest market update regarding interest rates. Most of the brokers have direct access to the bank. It may help you to get low-interest rates as well.
Don’t Do: Do not neglect to study your interest rates and ignore savings you could potentially make on things like rent. This will help you financially throughout your build. I saw many people do rush while taking construction loans. They are not doing proper research or analysis financial organization. It can make your process bit harder.
6. Managing Your Initial Deposit:
Do: Realize that on most loans a deposit is needed for things to run smoothly. This can be up to 10% of the loan but will vary.Many financial advisers suggest dealing with leading bank while depositing money. It may help you to get best and highest loans option.
Don’t Do: Do not take the first deal you see on deposits. Thorough research and planning will get you the best value for your money, and assure things run smoothly, meaning your loan will be approved quickly and correctly.
To sum up, I understand that it is time-consuming to do research on the financial organization while seeking for construction loans. If you do so, it might save mental panic and help to get low interest rates with affordable terms & conditions. In New Zealand, you must get many options while choosing financial lenders. If you take bit more time to finalize lenders, you may find good & affordable organizations.
Best ways to get business Loans in Auckland, New Zealand
Among all of the developed countries, New Zealand can be the best place to set up business. In New Zealand, anyone can set up business as long as they are entitled to live this beautiful country. Many overseas investors keep in easy to invest money in this highly developed country. To run or set up a business, you may need to sort out finance issues. According to my understanding, there are lots of lenders available who can arrange easy business loans in NZ. Besides, New Zealand has one of the most open and transparent banking systems, thus obtaining a business loan is not a problem. They use modern systems.If your business is experiencing financial problems, obtaining a business loan can be a better option. In New Zealand, you have a lot of options to choose from.Choose your lenders carefully, not all lending institutions are banks. Different lenders have different interest rates; some of which are very high. Check with a licensed financial advisor or budgeting specialist before you sign any loan contract
6 Best Ways to Get Business Loan Approval faster in New Zealand:
It is not hard to get quick approval for business loans. In this blog, I will explain 6 top ways to get business or commercial loans faster.
Start your own business:
It is very important to have own business in New Zealand. You have to own a business in order to secure a loan. The type of loan you require will vary with the type of business you have. It can be a one-time project and you require a business loan to pay workers or a long-term business project.
Have a registered business:
You need to register your business with NZ authority before running any business. For you to get quick loan approval your business has to be registered with one of the government agencies. The New Zealand Business Number(NZBN) is one such agency where you are given a unique identifier which helps you speed up business interactions.
Have a Business Plan:
It is very important to have the proper business plan before applying for any loans in New Zealand. Most of the banks or non-bank lenders must ask for your business plan. A business plan should be rive by genuine data and well implemented. For easier business loan approval, you can present a good business plan to the lenders and obtain a loan. Presenting a good business plan shows potential and viability of business growth.
Research the Criteria by Which the Lenders Evaluate Borrowers:
If it is a bank, your bank statement may go a long way in getting your loan approved quickly. The statement will help the bank establish if you can keep up with loan repayment term. It is important to find a reliable lender.
Collateral
Lenders worry how you will repay in case of business failure; they prefer you provide collateral to secure the loan. You can present assets such as real estate, cars, and your house. If you have a secure job, it can also applicable while applying for business loans.
Request for a Realistic Amount
According to my understanding, it is very important to have proper business plans with accurate expenditure. You need to seek affordable loans and have the proper plan for repaying your loans. if you own a small business, first decide on a figure which you want to ask for as a loan; make it realistic. The lenders you’re dealing with require you to ask for want you need exactly.
6 Benefits of Having Brokers for Getting Loans:
To get faster loans approval, you need to have proper documentation and plan. If you have a financial broker, they can help to prepare theses paper works. In New Zealand, most of the brokers get the commission from banks or lenders. They will not charge any money from your side. So, it can be a handy idea to get help from professionals, who are not charging you for service.
Provide Financial Advice
A broker will study your business and give you the best advice regarding the best type of loan and the best financial institution. Most of financial brokers or advisors are highly qualified and experienced. They can give you right advice based on their experiences and real-life data.
Financial Network
Finance brokers usually have a large network of connections and can be very crucial in cases where loans processes take a long time to get approved. They act as the “go-between” between you and the lenders. They have a very good connection with most of banks or lenders. They can easily find best interest rates and loans on behalf of you.
No Bias:
Brokers do not work with the banks, hence, there is no personal bias in deciding on loan approval. They will shop for the best loan with the lowest interest rates. If you able to find a good broker, they can guide you to get loans faster.
Policies and Laws:
The process of acquiring loans if full of complicated laws and policies. With a broker, all of will be well catered for. We always prefer to have experienced professional for getting financial advice. If you hire local financial brokers, they can help you to prepare documentation and get loans faster.
Covers all your needs:
Normally, a financial broker has the extensive understanding of the present economy and financial status. They can give you best suggest and help to covers all your needs. Brokers will look at your business at the moment and future expansion and ensure you get the best loan to cover your entire plans.
Saves Time
If you have a busy schedule, brokers will come in handy and negotiate a business loan on your behalf. Besides, a financial broker has easy access to all lenders. They can find best interest rates within a short time.
To sum up, it is very imporant to have proper financial flow for running any business. In New Zealand, it is not hard to get business loans approval, if you have proper business with good plan. Overall, acquiring a business loan in New Zealand you need to be fully prepared with all the necessary requirement. At the end of it, all keep a good credit record.
New Zealand Real Estate Updates 2018
Ajay Kumar is one of the leading licensed financial advisors in New Zealand. He is owner and director of Global Financial Services. Global Financial Services is a highly-regarded award winning mortgage and personal risk advisory company. They have three different branches in Henderson, Manukau, and Mangree. They started our journey in 1999. They are one of the leading & best mortgage brokers in Auckland. I have interviewed Mr. Ajay Kumar regarding recent real estate trends. He gave informative inputs regarding real estate trends in 2018. Check out his full interview with Mortgage Reviews team.
1. How do you think the year 2018 will be for the housing market in Auckland?
There remains a strong demand for housing in heavily populated areas of NZ. Some lenders are beginning to soften their lending criteria in line with the Reserve Bank of NZ LVR restriction easing effectively 1 January and their own market share objectives. This will enable first home buyers as well as property investors easier access to credit in 2018. It will support an increase housing market activity during the next year. Despite the recently reported 0.9% drop in Auckland house prices, the overall housing market during 2018 will be better than 2017. House prices are unlikely to come down much further because the imbalance between demand and supply is still there particularly in more desirable locations. First-time home buyers, if possible should try to focus on new build properties as lending criteria tends to be easier for these types of purchases. If new build properties are not available within your budget, focus on affordable existing houses in a wider range of locations where supply is better to get yourself on the property ladder.
2. How will new government’s legislation might affect the first home buyer?
So far, none of the new government’s announcements particularly regarding immigration and foreign buyers are likely to have any major or immediate impact either on the housing market as a whole or first-time home buyers specifically. It is expected that as government policy supports the increased supply of new houses we will see a steadier and more contained house price market generally.
3. How is the credit lending situation for home buyers right now and what is the trend going forward?
Banks will follow the Reserve Bank of NZ guidelines. RBNZ announced on 29th November an increased confidence in the financial stability something it credits to a combination of Government policy and LVR restrictions in place since 2013. As a result, the Reserve Bank is undertaking a modest easing of the LVR restrictions.
No more than 15 percent (currently 10 percent) of each bank’s new mortgage lending to owner-occupiers can be at LVRs of more than 80 percent.
No more than 5 percent of each bank’s new mortgage lending to residential property investors can be at LVRs of more than 65 percent (currently 60 percent).
Most of the banks are implementing this policy. It will enable to many prospective house purchasers to qualify for more lending subject to repayment affordability. It is a good sign for the housing market.
4. Would you say that it is the right time for home buyers to enter the market?
It is difficult to answer because what will be the future demand and supply is difficult to predict accurately but it is widely acknowledged that we do not have the housing stock or the construction capacity to meet our needs anytime soon in the heavily populated areas of NZ. However, if you have a goal to own your own home and you are in a position to achieve this then, yes, it is a good time to buy because it will fulfill one of your important goals. Rents are increasing due to the housing stock shortage and in some instances the withdrawal by landlords from the long-term rental market in favour of short-term stays via organisations like AirBNB which can put a burden on your budget when you find your landlord has increased rent or is unwilling to renew your tenancy lease in favour of the short-term stay market. Of course, apart from the stability of owning your own home, all future capital gains go to house owners, but not to the tenants.
5. What would be your five best tips for first home buyers?
- Buy the house only, if you can afford to repay mortgage as well as the other related costs such as rates, insurance, maintenance etc.
- Have a Kiwi- Saver account, if you do not have one already.
- Deposit your income from all the sources in your bank account and keep all your savings whether local or overseas in your bank account
- Reduced Credit Card limits as low as possible as limits (not outstanding balances) have a direct impact on the amount you can borrow, reduce/ repay hire purchases and personal loans.
- Maintain a good credit rating by keeping on top of your bills and limit the number of credit checks done on you as they also have an impact.
Best Ways of Getting Business Loans in New Zealand
Business or commercial loans can be very handy to run any types of small to large business. In New Zealand, 70% small to large business operate by local or international business loans. Capital is a necessity in starting any kinds of business. Financial assistance might be needed for this purpose or in expanding a business. Business loans are there to serve this purpose. A business loan, therefore, is the borrowed capital by a company or an individual to cater for expenses that the business owners cannot pay without assistance. There are different options for business loans, and business owners may choose which option to consider. Loans are given out for a fee and it is wise to choose between options and go with those lenders that charge lower interest rates. It is not easy to get a large number of business loans if you have a problem with credit. You need to arrange proper documentation before applying for business loans in NZ. The best way to get business loans in New Zealand is by learning different strategies to obtain quick business loans. There are many banks and financial organization lend business loans in New Zealand. In this blog, i will point our couple of ways to get loans faster.
Best ways to Get Quick Business Loans in New Zealand :
•In New Zealand, there are different types of business loans or commercial loans available. You will need to know the different types of business loans available based on your business or property. This will enable you to have a variety of choices and consider them regarding your needs. It is, therefore, necessary to go online and research on different business loans available.
• After identifying the types of business loans available, now find the best lenders with favorable lending terms. Such favorable terms will include reasonable interest rates and time of repayment. Different types of lenders exist and again, it will depend on your business needs and the type of loan you want to borrow. In New Zealand, most Banks and financial organization lend loans. So, you need to analysis best terms and condition while applying for business loans.
• It is always important to keep your financial statements in order because this is what the lender will use to consider whether or not to agree to lend you the money you need. This will hasten the process of your loan application.
• You should always update your online profile since the lender will need to review the information about the borrower to ensure a guarantee of repayment and the borrower’s reputation. To ensure you receive quick loans, this info should impress the lender.
• Hiring brokers for getting business loans is very important as it increases chances of getting a loan with favorable terms and conditions. I personally recommended hiring financial brokers as they will not charge any things from you. Most of the brokers normally get the commission from banks or financial organization. The reason, I am recommending brokers are to get access from multiple financial organizations and time-consuming services.
Benefits of Having Brokers for Getting Business Loans:
Many people not interested to hire or get help from a financial broker. However, I am not agreed on this point. I always prefer to get expert help and advise. If it is free to get financial advice, why should not we get help from a broker? Getting a business loan will require preliminary research. Hiring a knowledgeable broker saves time and struggle. The following are some of the benefits:
• Loan brokers ensure that you get favorable loan terms and rates. They are highly knowledgeable since this is their line of work. Most of the brokers have multiple financial organization access. They can analysis & find best loans based on your business needs.
• A broker will help you discover alternatives if one line of getting a loan fails. He/she will also give you appropriate advice from experience to help you secure the best business loan. In New Zealand, most of the banks may reject your application, if you have lack of documentation or bad credit. However, there are many third-party financial lenders may arrange loans though you have bad credit.
• The brokers are highly knowledgeable of business terminologies and marketing strategies involved in business loans. This proves advantageous especially if it is your first time to take a business loan. In addition, financial advisors must need to be certified in New Zealand. So, it is for sure that most of the financial brokers are very knowledgeable and expertise in this industry.
• Brokers save time since it is their day job and they have a good network of lenders and they can choose for you the best lenders.
• Brokers are excellent negotiators and a reputable broker will help you get great deals favorable to your business.
It is necessary to note that a loan must be paid and the borrower must be capable of repaying the loan. Getting great deals and best loan rates will depend on your research about business loans and application of the different tips given in this article.
Best way to refinance mortgage in New Zealand
Mortgage refinancing has become a popular investment norm practiced by many individuals in New Zealand. Basically, a refinance mortgage is where an individual gets another mortgage for purposes of replacing the original one. By doing so the first loan is cleared allowing the creation of the second one. Many people opt for this type of service when they succumb to high-interest rate accompanied by unstable economic times making it hard for one to clear their initial mortgage loans. By doing so, they are able to get reduced interest rates as well as take huge cash amounts from their homes to fund their day to day activities. There are many lenders offer low-interest rates mortgage refinance in NZ. It is highly recommended to choose affordable and trust-worthy lenders for refinancing loans. According to my research, we need to follow few issues while choosing refinancing lenders. In this blog, i will explain and illustrated common facts of choosing lenders for refinance loans.
As refinance mortgages are gaining massive popularity daily, it’s important to understand some of its advantages before venturing in the same. Below are some of the benefits of refinancing a mortgage in New Zealand.
1. Lower your monthly repayments:
Once you refinance to a mortgage loan with a lower interest rate compared to the original one, you will enjoy low monthly payments as well. Especially if both your loans have the same pay off period. There are many mortgage or loans lender available in New Zealand. It will be great if you find lower monthly repayments for your mortgage or loans.
2. Consolidate all your debts:
Refinancing can help you manage your finances with ease as they help you consolidate some of your debts into your mortgage. Such debts include car, credit card or personal loans. If you are the first home buyer, debt consolidate can be best options to repay your loans faster.
3. Faster mortgage payments:
Many individuals usually start by borrowing a loan with a high repayment period, say 30 years. Then, after some time refinance the mortgage with one whose repayment period is lower, say 15 years fixed-rate mortgage. Since rates on the 15-year loans are lower as compared to the 30-year ones, it will take a shorter period to repay the same as well as help you save some significant amount of money.
4. One can change the loan type programme:
Some mortgage rates are quite unpredictable. This means that they may face fluctuations over time without warning. In case of rising rates, homeowners will find the original deal less attractive and will want to shift to more favorable rates available in the market at that time. Refinancing will help an individual to get the best loan rates currently available.
5. Clear one’s name from a mortgage:
There comes a time when the person who originally signed the mortgage doesn’t want to be held liable for their financial support is no longer required. The only way to get their name off the mortgage is by refinancing.
6. Unlock equity:
For the case of cash-out refinance, homeowners can utilize the equity created in their homes. This comes in handy should one want to take their child to college, renovate their homes or pay off credit card debts.
7. Improving your credit score:
.Incase your credit scores have gone up due to timely mortgage payments, one can take advantage of this by refinancing into a loan with lower interest rates to decrease payments.A credit score is very important for future loans or mortgage. If you fall to bad credit score, it can narrow possibility to get loans. Refinance can help to improve your credit score.
8. Helps to borrow money:
One can borrow money against their homes’ equity with the cash-out refinance mortgage. The amount borrowed is added to the mortgage amount.
Whereas refinance mortgages can prove to be quite favorable as an investment method, if not done right it can result to huge losses rather than being beneficial. The main mistakes people make while applying for finance mortgages in New Zealand are as thus:
1. Failure to do your homework:
Before applying for refinancing services, one should conduct basic research in order to determine closing costs, rate and new payment without anyone having to pull their credit. One should have a general idea on their credit worth as home as their homes’ value.
2. Having a low credit score:
Morgage rates and credit scores are directly proportional. In an even worse scenario, when you have a lower credit score, very few lenders will want to work with you if not none at all.
3. Not comparing the firms that offer refinance Mortgage services:
That slight difference in loan rates can save you quite a sum of money. Many individuals make the mistake of rushing to their regular banks for refinancing loans instead of shopping around to get the best rates currently in the market. Many New Zealanders are not doing proper research while choosing mortgage or refinance mortgage. I personally believe to hire a broker who can compare and research low interest for myself. Most of the mortagge brokers may not charge any money for these workers.
4. Timing mortgage rates:
Waiting for mortgage rates to hit their lowest so that one jumps onto them can be one tricky venture. Just like the stock market, it may be difficult even for professionals as one may realize huge loses when the rates shoot up again.
5. Cashing a lot of home equity:
With many people using refinance mortgages as an opportunity to borrow against their home equity, individuals may tend to overdo the same. Therefore, should housing prices fall borrowers are left exposed?
6. Failure to lock your mortgage rate:
Borrowers normally fail to keep an eye on prevailing interest rates and forget to lock the same with their lender. You might be optimistic that the rates might drop again if they rise but that will be like gambling, things might backfire.
Well, when all is said and done, refinance mortgages can prove profitable as well as a fruitless venture. To get the best from it, just make sure you do it right, it won’t fail you.
How to do debt consolidation faster in New Zealand?
Debt Consolidation is great. It’s the process of getting one loan to pay all other different loans you may owe. This is an incredibly effective strategy since it can reduce your interest rates and combine everything into one simple payment. Some of the experience and loyal brokers have unique save interest plan. This type of plan can help your debt consolidation faster. According to my understanding, 79% financial adviser offer debt consolidation in NZ. It is very important to choose expertise mortgage brokers for doing save interest plan In this article, we’ll take a look at 8 effective way to find Debt Consolidation brokers in New Zealand as well as 6 common mistakes while doing Debt Consolidation. All this will surely help you use Debt Consolidation to its maximum potential.
Ways to find debt consolidation Brokers in Auckland, New Zealand:
There are many mortgage brokers available in New Zealand. It is not hard to find good brokers if you do proper research while choosing financial advisers. I am going to illustrate some of the core indication while choosing financial brokers.
1. Broker Service Fees:
You are looking for brokers that charge low fees (obviously). Since you don’t want your future debt with the debt consolidation be higher than what you’re currently owing. 90% financial brokers may offer you free services or consultation as they get a commission from banks. So, try to find a local advisor who offers free services.
2. A wide range of loan amounts
It is important to find lenders that work for you. Some cap out the range of loan amount to very low ($5,000 – $10,000). The best lenders will approve high loans ($25,000+). It can be handy to have a free consultation with financial advisors and ask them regarding a range of loan amounts.
3. Good loan terms
Some lenders will try to give you an impossible length of loan terms. The best ones will be flexible allowing shorter terms and even longer terms. You need to do bit research while accepting loan pay term. You may consider your income and other possibilities to pay the loan.
4. Geographical Reach
Obviously, you want to find a lender that is in your area but also has a wide geographical reach. You don’t want someone who will give you a hard time for being out of town. In New Zealand, there are many independent and agencies offer financial broker services. It is important to choose local and experience financial brokers for assisting debt consolidation.
5. Interest rates
In New Zealand, there are many banks and financial lenders offer mortgage or other loans services. It is important to find lower interest rates on your mortgage. You’re getting a Debt consolidation because you’re looking to lower your interest rates. No brainer, choose the lowest rates possible.
6. Transparency
Look for lenders that aren’t shady. The best ones will make sure you’re 110% aware of everything before signing, instead of rushing you through the process.
7. Credibility
Make sure you aren’t going to a random lender. You don’t want to screw up anything. Do your research, read a ton of reviews and check the background of the lender before going to them to ask for a loan.
8. Use your gut feeling
the end of the day, some people will just not feel right to you. When it comes to finances, it’s best to work with someone you enjoy instead of having negative thoughts. Find somebody that you feel is a great person.
Common mistakes people make while doing debt consolidation :
45% New Zealander complain that they had very had experience with many mortgage brokers and financial lenders. According to my understanding, we need to avoid few mistakes while choosing debt consolidation consultant. Some of the common mistakes are :
1. Working with the wrong lenders
I already mentioned that there are many banks and financial lenders available in New Zealand. It is important to choose reliable and good money lenders. Obviously, this can cause a ton of problems. Since now you know how to find the best lenders, you should never make this mistake ever again!
2. Consolidating the wrong debts
Some people do debt consolidation plan by themselves. It can be big issues if you do wrong debt plan. As long as financial services are free, it is important to choose a good and experienced mortgage broker. You want to consolidate your high-interest loans, instead of those that have a low interest.
3. Wrong lifestyles
According to research research, 60% Kiwi could not affordable own home for expensive lifestyle. If we consume 1 less coffee each day, we can save lots of money and we can debt faster. you’re in debt because you screwed up somewhere. Debt consolidation is not a cure, it’s a better solution. Switch your lifestyle around to one that spends less and saves more.
4. Scams
You’re working with money, do your research, don’t fall for frauds. Period.
5. Wrong debt management program
There are a bunch of debt management programs. Make sure you pick the right one. Research everything before you make a decision. We need to have unique and effective save interest plan for debt management.
6. Paying too much
Again, you’re working with money. Make sure you do your homework and research everything. You might end up paying a ton more if you don’t.
In conclusion, debt consolidation can be an amazing tool to secure lower interest rates and combine your different debts. Make sure you look through every nook and cranny and you’ll be alright with this important financial decision.
I strongly believe that we can pay off our mortgage faster if we have efficient and solid save interest plan. For getting unique and efficient save interest plan, you need to look for expereinced and good mortgage broker in Auckland, New Zealand.
Some of the most fundamental mortgage refinancing issues
Mortgage refinancing is in simple terms to swith one bank or lenders to another bank or lenders. Most of people has fear regarding documentation stress or change over stress. However, it is very easy process and it gives you change to get lower interest rates. Almost all mortgage broker agencies or independent professionals provide affordable and expert mortgage refinance services in NZ. It is very important to choose experienced and specialized refinace brokers. For most homeowners, clearing the home mortgage is a daunting task. So much effort is put into raising funds, others suffer excessively by paying without being aware of interest rates and changes in the economy. The best way to put a stop to all this financial torture is by carrying out mortgage financing. This is the getting of new mortgage in order to replace the current one. It is carried out to obtain a better interest rate on the current mortgage. Here are some of the best ways to refinance mortgage:
1. Research on the value of your home:
It is very important to get valuation for your property. Doing this is easy if you apply the right technique. You don’t have to make so many calls or try to identify its builder. Simply identify other homes in your locality that resemble it and find out their costs from their owners. This will enable you to come up with a reasonable cost for your home. Alternatively, you could look up its value on credible home value sources online. If you get proper valuation for your property, you may go to broker to refinance your mortgage. It is very faster and easy process.
2. Find out why you’re refinancing
It might sound obvious, but refinancing for all the right reasons will get you faster results. Don’t do it because others are doing it. Do it to meet your own individual needs, such as maintaining the term of your loan as you lower the rate of interest. You may get offer for many brokers for doing refinance. You should choose good and local brokers.
3. Get all the necessary paperwork
It is very important step for doing mortgage refinancing. If you get all necessary paperwork, it means 60% work done. This may be difficult to do if you carry out all your financial affairs via the internet, but it’s crucial since the lender will need it during the loan process. Print or download them if you have to.
4. Look around for the best mortgage rate
In New Zealand, most of banks and financial lenders offer different interest rates. You need to resarch and find best mortgage rates before refinancing. I personally recommeneded to hige professional broker. 90% brokers offer free consultation as they get money from bank. You have to be aware of all the rates available so that you can make an informed choice. You could make this possible by subscribing for daily updates or carrying out research online.
5. Find out your present credit score
It is very important to know your present credit score. If your credit score is lower, you may not get refinancing from top ranked banks in New Zealand. A credit score is a value that determines how worthy you are to receive a loan. If you have a good score, you’ll receive numerous impressive mortgage refinance interest rates.
6. Know how much you’re required to pay
Mortgage refinancing can involve fees such as recording fees, an underwriting fee, and an application fee. Finding out all the fees that come with your preferred choice will help you to plan in advance.
As much as mortgage refinancing can be a great source of help, it can also be a curse if carried out blindly. Here are some mistakes you should avoid as you carry it out:
1. Not carrying out research
40% New Zealand are not doing proper research while approcing mortgage refinancing. It is a big mistake. You need to do proper research while choosing brokers in Auckland or other cities. This makes you spend more than what you planned for or worse still gets you high-interest rates for your mortgage. Before taking this major step, do your homework thoroughly.
2. Failing to shop for alternative mortgage rates
Most people become complacent with working with their current lender. This makes them miss out on better deals that are offered by other lenders. It helps to compare the quote of your lender with those of other lenders.
3. Not putting all the costs into consideration
It helps to be keen on details that are easily overlooked such as the duration of time you have on your present mortgage and if your loan has a penalty for early payment of the mortgage.
4. Failing to lock rates
It’s widely known that refinance rates are not constant. It will, therefore, save you the headache of paying your loan based on the never-ending changes by locking in a rate with your lender.
5. Forgetting that mistakes are bound to happen
If you don’t meet all the requirements, bear in mind that you’re likely to encounter challenges as you seek mortgage refinancing, such as the failure to submit the documents on time.
6. Having a low score on credit
If you have a low credit score, your chances of finding a lender are nill. Trying to compromise with what you currently own will only make things worse.
7. Applying for new credit accounts
Applying for a new credit account could lead to a delay in the process of approval of your request. Lenders check if you apply for one before considering offering you a loan. They may reject you in extreme cases.
8. Failing to consult
If you’re not conversant with the internet, it helps to seek professional assistance from a realtor or a friend who went through the process successfully. Failure to this leads to dire consequences.
In order for mortgage refinancing to be of help to you as a homeowner, you have to go through all the lengths to ensure that you get the help that benefits you and raises your chances of getting a loan without later regrets.
Benefits of Mortgage Refinancing
The mortgage refinancing can be understood in the simplest way as the shifting of a loan from one borrower to another under some mutually agreed conditions. Normally people use to refinance their mortgage in order to get the easier terms of payment and rescheduling of the installment plan. They can even get the discount in rates in mortgage refinancing. Most of the people think that mortgage refinancing or restructuring can be difficult or it might create some people for ongoing loans and rates. However, it is not real. There are many brokers provide easy and fast mortgage refinancing in NZ. Most them offer free services and consultation as well. On the other side, refinancing can also enhance the risks and financial hurdles for the people having poor repayment history.
Benefits of Mortgage Refinancing Services:
I already mentioned that it is very important to restructure or refinance home loans, if necessary. In this part, I am going to point out some core benefits regarding this issues. The prevailing practice of mortgage refinancing itself is the evidence of its usefulness for the people. There are certain benefits due to which people go for refinancing their loan with some new lender. You can go through the following pros of mortgage refinancing before making your final decision.
- People refinance their mortgage plan because of the shorter repayment schedule with a minimal or no change in monthly installment. This advantage of mortgage refinancing depends upon the random decrease in interest rates at the government level. According to specialists, many times bank needs to refix rates of the loan. In these circumstances, we need to refinance a home or commercial loans.
- The lower interest rates in the mortgage are also subject to the clean repayment history of the customer’s utility bills. In this way, you can enjoy the benefit of lower rate in refinancing if you pay your bills and liabilities on time.
- The lower interest rate in the refinanced mortgage plan certainly comes up positively for the customers to have some monthly savings for their families. There are many banks and lenders offer different rates for different occasions. It can be a good idea to switch better offer regarding rates or other opportunities.
- Another benefit of mortgage refinancing is the opportunity for customers to buy expensive items or paying off the debt amount of their credit cards.
- Refinancing of mortgage often gives customers the provision of negotiating with the multiple refinancers and win the lowest rate for the new plan.
- Another fascinating privilege in refinancing is the option of the merger. Customers can easily merge their multiple mortgages and credit debts into one new mortgage plan with even shorter plan and lower rates.
- Many experts point out that we can pay off a mortgage faster if we can do efficient refinance for home loans.
- In New Zealand, customer services are very important. However, some banks may not provide standard customer services. So, it is a good idea to switch, if we are not happy with current lender.
Mortgage refinancing downside:
Apart from the benefits, customers of mortgage refinancing also face significant drawbacks which need to be considered before the maturity of a deal between the parties. Following drawbacks establish the limitations or the mistakes occurred by the customers in refinancing their mortgage plan.
- You should look into the fact that the mortgage refinancing can although benefit them in saving some extra bucks but you should also, consider the risk of joblessness by which you will suffering going along with your new mortgage plan.
- As per the suggestions of financial experts, customers must carry out the calculation work in terms of the processing fee for the new mortgage plan. Because in many cases the fee of refinancing is as high as it is compensated by the customer through his/her savings up to months.
- One common but important issue may arise regarding the prepayment penalties by the existing mortgage lenders. In almost all cases, you have to pay extra penalty amount if you want to pay off your loan before time.
- In order to get the benefit of lower rate in the refinanced mortgage plan, customers have to live in their existing houses for a certain number of years to be ease in their savings.
- If you are busy enough, you are more likely to be frustrated with the extensive paperwork and verification process involved in the mortgage refinancing.
- Above all, if you go to refinance your mortgage plan without proper homework and calculation, you will be disappointed because the latest interest rates or the processing fee are likely to distort your expectations if initiated.
To sum up, home loans refinance in simple terms is the way of switching banks or money lender and transferring your home loans from one bank to another bank to take advantage of more favorable terms and conditions. It can help you to repay your mortgage faster. According to my research, 35% New Zealander is keen to get good rates with excellent customer services from banks or money lender. If you are not happy with your current lender, just refinance with other banks or lenders. It is very easy and fast processing.
