So,
I have a friend I'm helping buy a home, and she, in theory qualifies for the "welcome home loan" scheme.
So off she toddles to Kiwibank to see what's what.
Now, this is in Wellington, so the scheme will go up to a house price of $350K....BUT....
You have to have an income of $85K or less to qualify (tick), you have to have some deopsit of your own to get over $200K purchase price (tick), so she qualifies... right?
WRONG.
Now in Wellington you need $250K to really get much at all, but at this level Kiwibank calculate the debt servicing, and decline the loan! (Welcome home loans seem to have an invisible risk flag in the bank's calculations).
So, with a 10% deposit in cash and a target price of $250K, Kiwibank will not lend without a higher salary!. "How much salary do you need?" we enquire with some curiosity.
"Over $90K".
"but the Scheme caps out at $85K"
"Oh... ur... erm... yes it does."
"So if we forget the Welcome home loan scheme, can we borrow $225K with a cash deposit of $25K on her salary of below $85K?"
"Um... tappey tappy tap... the computer says yes
"so the only way to qualify for the welcome home loan is to have a high enough salary to disqualify yourself for it?"
"Um... it appears so.... no wait.. if you had a really big deposit you'd be OK"
"If we had a really big deposit we wouldn't need the Welcome home loan scheme to get a big enough deposit... would we?"
"Um... no"
"how many Welcome home loans have you personally written as a mortgage salesperson?"
"none"
Anyone out there ever actually seem one of these go through?
I have a friend I'm helping buy a home, and she, in theory qualifies for the "welcome home loan" scheme.
So off she toddles to Kiwibank to see what's what.
Now, this is in Wellington, so the scheme will go up to a house price of $350K....BUT....
You have to have an income of $85K or less to qualify (tick), you have to have some deopsit of your own to get over $200K purchase price (tick), so she qualifies... right?
WRONG.
Now in Wellington you need $250K to really get much at all, but at this level Kiwibank calculate the debt servicing, and decline the loan! (Welcome home loans seem to have an invisible risk flag in the bank's calculations).
So, with a 10% deposit in cash and a target price of $250K, Kiwibank will not lend without a higher salary!. "How much salary do you need?" we enquire with some curiosity.
"Over $90K".
"but the Scheme caps out at $85K"
"Oh... ur... erm... yes it does."
"So if we forget the Welcome home loan scheme, can we borrow $225K with a cash deposit of $25K on her salary of below $85K?"
"Um... tappey tappy tap... the computer says yes
"so the only way to qualify for the welcome home loan is to have a high enough salary to disqualify yourself for it?"
"Um... it appears so.... no wait.. if you had a really big deposit you'd be OK"
"If we had a really big deposit we wouldn't need the Welcome home loan scheme to get a big enough deposit... would we?"
"Um... no"
"how many Welcome home loans have you personally written as a mortgage salesperson?"
"none"
Anyone out there ever actually seem one of these go through?
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