Welcome home loans appear broken

[ashleybarras]

my partner am me have got a welcome home loan.... bought our house in may.... we got approved for $265,000... found a house for $270,000 and were told that we could have the extra money really good.... hard in the unconditional stages... other than that everything was very smooth.... we went through TSB welcome home line..... i tries withkiwi bank first and they said we didnt qualify.... TSB however said we did... and we must have.... we own the house now!

[Exotic pumpkin]

I wouldn't trust what you hear from Kiwibank, when you are not actually party to the deal, and only gets the hearsay.
If someone qualified for a standard loan from banks, they don't qualify for Welcome. You can call the Wecome line yourself
to find out the facts.

Also, numerous people have got Welcome home loan, thanks for this product being available. Nos? You can call Welcome
phone NO and fine out. I've known a few people who got it.

[brokerman]

I find Welcome being a good marginal product to help some parts of the society. Brkerman, http://www.welcomehomeloan.co.nz/lenders.php , here you can find the list of lenders for Welcome loan, broker is not involved at all. No wonder they are not getting the business.

I am well aware of the Lenders involved and also know that a Broker is not involved. Probably accounts for 95% of applications declined, if a Broker was involved most of these would not get past the first post.

[WGN ex-property manager]

'A Welcome Home Loan helps people with modest incomes, who are outside standard lending criteria, to get a home loan with little or no deposit. '

Nope. That's just blurb explaining why Welcome home loans exist.

There is no criteria that excludes you specifically because you qualify for finance without it. Kiwibank told us that the block to getting the welcome home loan was debt serviceability.

"I find Welcome being a good marginal product to help some parts of the society."
How many people do you know (single incomes here, not dual incomes) who have closed a purchase using a welcome home loan?

[Exotic pumpkin]

At least the fact is clear now. This is the quote from the Welcome home loan website:
'A Welcome Home Loan helps people with modest incomes, who are outside standard lending criteria, to get a home loan with little or no deposit. '. Robin said she could get a loan at 90% via the bank. Then she shouldn't be qualified for a Welcome Home loan.

I find Welcome being a good marginal product to help some parts of the society. Brkerman, http://www.welcomehomeloan.co.nz/lenders.php , here you can find the list of lenders for Welcome loan, broker is not involved at all. No wonder they are not getting the business.

[speights boy]

It's probably because it was the last one they had in stock.

If they used that one, they wouldn't have one available in case someone came in wanting one.

[WGN ex-property manager]

Brokerman, how can you get people to come to you for Welcome home loan when it's not even available through your channel? Robin, I don't think you can assume the risk weighing without knowing the facts.
Unless her financial situation is disclosed clearly here, I don't think it's fair to comment on Welcome Home loan with biased and unjustified grounds.
If we are talking about an average person with good income, not many debts, single, really, any bank would lend them the money, including it via Welcome, based on servicing. Remember, in essence, Welcome is targeted for low income people, therefore, it's servicing
criteria is noramlly more relaxed than the other lenders. There must be part of the story that has not been told.

Just to be totally clear here:

Can she borrow 90% without welcome home loan... YES. Can she borrow 90% with welcome home loan.... NO.

Same bank, same debt, same circumstances.

[brokerman]

I don't get people coming to me for WHL, I get the one's WHL decline, which is a lot! Also I do know Brokers who help people with it and charge a fee.

[Exotic pumpkin]

Brokerman, how can you get people to come to you for Welcome home loan when it's not even available through your channel? Robin, I don't think you can assume the risk weighing without knowing the facts.
Unless her financial situation is disclosed clearly here, I don't think it's fair to comment on Welcome Home loan with biased and unjustified grounds.
If we are talking about an average person with good income, not many debts, single, really, any bank would lend them the money, including it via Welcome, based on servicing. Remember, in essence, Welcome is targeted for low income people, therefore, it's servicing
criteria is noramlly more relaxed than the other lenders. There must be part of the story that has not been told.

[brokerman]

Spot on. With all Banks at 90% plus lending the UMI (uncommited monthly income) is higher than for say 80% borrowing.
Just had a client call me saying she had approached Kiwibank 2 months ago for a 95% advance, verbally OK but they won't issue a conditional offer until Clients kiwisaver provider produced a statement. This they have done but KB still won't issue the conditional offer letter. She earns a lot but has a $20K bank loan so in my opinion she won't get a 95% mortgage particularly with KB as QBE won't sign it off. The only Bank who I think would do this would be ASB as they self insure and so don't rely on QBE or Genworth.

[WGN ex-property manager]

What seems to be happening is there is an invisible "risk weighting" in the banks servicing calculations that requires people who want the Welcome home loan ( to solve a small deposit problem) to have a healthier debt servicing % than those who don't.

This is kind of speculating and reading between the lines a bit, but it's the only conclusion I can come to after dealing with Kiwibank.

[brokerman]

Always use a qualified Broker, pays off every time!

[Exotic pumpkin]

Also, after further checking, Welcome Home Loan does not use brokers at all, this answers the question as to why brokers have little to do with it. You'll need to deal
with the banks directly, being Kiwibank, TSB and SBS, as I understand.

[Exotic pumpkin]

I can't figure out. In fact, I'm extremely puzzled. If she qualifies for a standard loan, she does not quality for Welcome home loan. In this case, she doesn't qualify for Welcome.

On the other hand, there is the issue of servicing calculation. For a small loan of 225k, what makes her not able to afford it if she doesn't have debts or kids? I think something is lost in translation. How much is her income?

[WGN ex-property manager]

No Kids, No consumer debt.

Only looking to buy a $250K house (a realistic target), and use the welcome home loan to preserve her cash deposit, so that could be used to upgrade the house.

Without the welcome home loan she qualifies for a loan. With the welcome home loan she does not!

Go figure