Buying your first home is exciting. Getting your documents and finances organized early can make the mortgage application process much easier.
One of the most useful things you can do before applying for a mortgage is get your finances and paperwork organised. A well-prepared application gives your mortgage adviser and lender the information they need to understand your financial position.
You do not need to have everything perfect before speaking to a mortgage adviser. Talking to an adviser early can help you understand what you may need to prepare before you apply.
1. Know Your Budget Before You Start Looking
Before spending weekends going to open homes, work out what you can realistically afford. Your budget should consider more than the purchase price.
- Expected mortgage repayments
- Council rates
- Home insurance
- Utilities
- Maintenance and repairs
- Body corporate fees, if applicable
- Moving, legal and inspection costs
Leave some room in your budget for unexpected expenses. A mortgage adviser can help you understand your potential borrowing range based on your circumstances.
2. Check Your Deposit Position
Your deposit is one of the most important parts of your home-buying preparation. Work out exactly how much you have available and where it has come from.
- Personal savings
- Savings held in different accounts
- KiwiSaver first-home withdrawal, if eligible
- Gifted funds, if applicable
- Other acceptable deposit sources
Keep records showing how your deposit has been built up. Savings statements, evidence of regular savings and documentation for gifted funds can help provide a clear paper trail.
3. Prepare Your Identification
Lenders need to verify who you are. Have your passport or New Zealand driver’s licence and proof of address ready. If you are buying with another person, each applicant will generally need their own identification documents.
4. Get Your Income Documents Ready
Depending on your employment situation, you may need recent payslips, an employment agreement, evidence of regular allowances, commission or bonus information, and other income evidence.
If you receive additional income, include it in the information you provide. Your adviser needs an accurate picture of your income position.
5. Have Your Employment Information Ready
Be prepared to provide your employer name, job title, length of employment, employment type, salary or hourly rate, contract information and start date. If you have recently changed jobs or started a new position, mention this early.
6. Download Your Bank Statements
Bank statements are commonly requested. Start getting them together early so you have statements showing income, regular expenses, rent payments, loan repayments, credit card payments, BNPL payments and savings contributions where relevant.
Tip: Seeing everyday spending on your statements does not automatically mean your application will fail. The important thing is to provide an accurate picture of your financial position.
7. List All Existing Debts
Make a complete list of what you currently owe, including personal loans, car loans, student loans, Buy Now Pay Later accounts, store finance, hire purchase, overdrafts and other financial commitments.
8. Check Your Credit Cards
Have the provider, current balance and credit limit for each credit card available. Even if you do not owe much, available credit can be relevant to a lender’s assessment. Discuss changes to credit facilities with your adviser before making them.
9. Show a Clear Savings History
If possible, keep records showing regular savings, deposit accumulation and the source of large deposits or transfers. The aim is to make your financial history easy to understand.
10. Prepare Property Information
You may not have a specific property when you apply for pre-approval. Once you find a property, the lender may need information such as the address, purchase price, sale and purchase agreement, valuation, LIM information, building report or body corporate information where applicable.
11. If You’re Self-Employed, Prepare Extra Documents
Self-employed applicants may need additional financial information, depending on the lender and business structure. This may include financial accounts, tax returns, IRD information, business bank statements, profit and loss information, balance sheets and GST information.
12. Don’t Forget Other Supporting Documents
Additional documents may include proof of address, visa or residency documents where applicable, evidence of other assets, rental history, gifted deposit documentation, or trust and company information.
13. Review Your Spending Before Applying
Look through recent transactions and understand your regular commitments. You do not need to make your account look artificially perfect. The goal is to understand your actual budget and make sure the mortgage you are considering is manageable.
14. Avoid Taking on New Debt Without Checking First
Think carefully before taking on new finance while preparing for a mortgage. This includes car finance, personal loans, new BNPL accounts, increased credit limits or financing expensive purchases.
15. Consider Getting Pre-Approval
Pre-approval can help you understand your potential price range before you seriously negotiate on a property. It is not the same as unconditional approval, and final lending can still depend on the property, documentation, valuation and lender requirements.
16. Use a Mortgage Application Checklist
- ID
- Proof of income
- Employment information
- Bank statements
- Existing debts
- Credit card details
- Deposit evidence
- Savings history
- Property information
- Self-employed documentation, if applicable
- Other supporting documents
Free Mortgage Application Checklist
Download the simple checklist and keep it handy while preparing your home loan application.
Frequently Asked Questions
How much deposit do I need to buy my first home in New Zealand?
The deposit required depends on your circumstances, the lender, the property and the lending criteria that apply. Some options may be available with lower deposits, but additional requirements can apply.
Do I need to have a property before applying for a mortgage?
No. Many first home buyers speak with a mortgage adviser and seek pre-approval before finding a property.
What bank statements do I need for a mortgage?
Requirements vary between lenders. You may be asked for recent statements showing income, expenses, savings and existing financial commitments.
Can I apply for a mortgage if I have debt?
Yes. Existing debt does not automatically mean you cannot get a mortgage, but lenders will consider your commitments when assessing affordability.
What if I’m self-employed?
You can still apply for a mortgage. You may need additional financial information to demonstrate your income and the financial position of your business.
Can I use KiwiSaver towards my first home?
Eligible first home buyers may be able to use KiwiSaver for a first-home withdrawal, subject to the relevant rules and eligibility requirements. Mortgage Advisors provides mortgage advice rather than KiwiSaver advice, so check your eligibility with your KiwiSaver provider or the relevant organisation.
Ready to Start Your First Home Journey?
You do not need to have everything figured out before speaking with a mortgage adviser. Mortgage Advisors can help you understand your lending position, prepare for the application process and explore mortgage options based on your circumstances.
Visit mortgageadvisors.co.nz.
This article provides general information only and does not constitute personalized financial, legal, tax or KiwiSaver advice. Lending is subject to lender criteria, terms and conditions.
Ready to talk about your first home?
Send us an enquiry and a Mortgage Advisor can get in touch with you.
0800 93 0000
info@mortgageadvisors.co.nz
