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Transcript

Three Mortgage Myths Which Shouldn't Stop You Buying · Making Cents

• 0:02
  Hey team, it's Frances.
• 0:03
  Look, there are enough things holding you back on that home buying journey without worrying about mortgage rules that actually don't apply anymore.
• 0:11
  So I gave a super quick rundown to the TVNZ breakfast team of the mortgage myths that could be holding you back when you could actually full steam ahead.
• 0:21
  They were kind enough to say, I could put that here for you too.
• 0:24
  So enjoy.
• 0:31
  Let's talk about mortgages and the big myths that people fall for.
• 0:34
  I mean, it's a massive decision, right?
• 0:36
  And you're actually thinking, can I commit to this?
• 0:38
  And there's all this background noise and these myths that people are telling you about why you can't do it.
• 0:43
  So let's bring that can do attitude.
• 0:45
  Why can people do it?
• 0:46
  What are these myths we need to dispel?
• 0:48
  Exactly.
• 0:48
  I'm taking a break from being the bad news fairy and I'm trying something a little new.
• 0:52
  Being nice solutions, focus, working on it.
• 0:55
  Because, yeah, here's the thing is buying a house is hard enough.
• 0:57
  It feels like a huge mountain to climb.
• 1:00
  And even though prices have been down a little bit and flattening out, it's still a huge deposit.
• 1:07
  So I think one of the big things to start with is people look at this idea, they get told it's a 20% deposit to buy a house and it's going to be in a lot of areas, 100,000, maybe
• 1:16
  $200,000 if it does not have to start with a 20% deposit.
• 1:22
  There's a lot of people out there who could pay back the mortgage if they had a smaller deposit.
• 1:25
  So you can often start with a 5% if you get get approved for something like a first home loan or you can talk to your bank or mortgage broker about a 10% deposit because banks actually have a certain
• 1:37
  amount of their borrowing that they can lend to people with low deposits.
• 1:41
  Currently they are not filling that.
• 1:43
  So a lot of banks will be friendlier on this than you think.
• 1:46
  For a long time there's been a feeling, probably justifiably so, that you can't do it alone.
• 1:51
  You need someone to do it with you, whether it's a family member or a partner or something like that.
• 1:57
  Is that still the case?
• 1:58
  And a lot of people feel like you need to be in that, you know, marriage relationship before you do this.
• 2:03
  And yes, you want to make sure that you're really rock solid with whoever you go into buying a house with.
• 2:08
  Certainly doesn't have to be a romantic relationship.
• 2:10
  There's a lot of people buying with siblings, a lot of people buying with parents.
• 2:14
  And I think the big thing is marriages can break up anytime.
• 2:18
  I think what you really want to think about, whoever you're looking at buying a house with it can of course help to split the bills.
• 2:24
  You just want to be able to go to a lawyer.
• 2:25
  You want to be able to have tricky conversations.
• 2:27
  You want to talk about what happens in worst case scenarios and you want to be comfortable sharing your full financial picture with them.
• 2:33
  If you're not comfortable having those worst case scenarios and you're not comfortable sharing all your financial info, that's a red flag that maybe you shouldn't.
• 2:40
  What about sharing your financial information with the bank?
• 2:42
  You're like, I don't want them to do an audit of what I've been spending my money on.
• 2:46
  You can see sky television.
• 2:47
  You can see Uber Eats.
• 2:48
  The Uber Eats.
• 2:49
  You can see the coffees.
• 2:50
  Don't look at it.
• 2:52
  Is that something that actually you're just going to have to get over?
• 2:54
  Yeah.
• 2:54
  Well, see, this is one of those used to be true, not true anymore.
• 2:57
  So we love this change.
• 2:59
  What's known as the triple cfa.
• 3:01
  When that came through, it made things really, really tough.
• 3:04
  And your bank was absolutely a judgy parent.
• 3:06
  They would go through.
• 3:07
  They hated the overeats.
• 3:08
  Eh, hated it, hated it.
• 3:10
  Anything that was, you know, responsible spending.
• 3:13
  Exactly.
• 3:14
  That's all changed.
• 3:15
  So for the last couple of years they haven't been looking at that.
• 3:17
  This idea of three months of clean spending.
• 3:20
  You don't have to worry about that.
• 3:21
  What you do have to worry about is things like gambling, things like debts, not your Uber Eats.
• 3:26
  Okay, is there some, some advice that you would give people that, that are kind of falling for all these myths all the time?
• 3:32
  What, what would be the one thing you would say to them about actually you can go and do it, go and get yourself a mortgage.
• 3:37
  Go and saddle yourself with this massive debt.
• 3:39
  Go and get a million dollars in debt.
• 3:41
  It'll be fine.
• 3:41
  Yeah, it's, I think really for a lot of people.
• 3:44
  If you're thinking, I would like to buy a house and I don't know how it would work, go and have a chat to a mortgage advisor because they are free to chat to you.
• 3:53
  They charge the bank, not you.
• 3:54
  And oftentimes you can go and chat to a mortgage advisor and say, here's my financial situation, here's where I would like to end up.
• 4:00
  What's the path from here to there?
• 4:01
  And I've talked to so many mortgage advisors who, who got people match fit in six months to a year.
• 4:07
  So much faster than they thought.
• 4:09
  So really, go and talk to a professional.
• 4:11
  They can shop you around the different banks.
• 4:13
  They know how things work.
• 4:14
  With that, it can be a lot closer than you think.
• 4:17
  This podcast can only give you general information about how things work in most situations.
• 4:23
  It's not individual financial advice.
• 4:25
  If you're after that, a financial advisor is always the best bet.