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  1. #1
    Join Date
    May 2009
    Location
    NZ
    Posts
    99

    Default Spreading mortgages (personal home, rentals etc)

    Hi, Kiwibank have approved our new loan for our first two rentals, meaning we'll be with them for these and for our personal home loan.

    Quick details: 100% finance on the rentals but our LVR including the personal home will be about 70%. The rentals will return about 7.9% gross. Overall though because of rates, management, and insurance etc. we'll be topping these up. We have owned a share in and managed a rental before.

    I saw comments here about spreading mortgages among banks. I appreciate that it's probably the best thing to do, but given our intention/desire to keep buying rentals will realistically take 2-3 years to actually continue after buying these, is there any compelling reasons to worry about the idea of splitting our borrowing for now?

  2. #2
    Join Date
    Sep 2013
    Location
    Auckland
    Posts
    3,885

    Default

    Given Kiwibank is one of the worst banks to borrow from (ie more difficult to borrow), I say sooner or later you will be looking for another lender anyways.

  3. #3
    Join Date
    May 2009
    Location
    NZ
    Posts
    99

    Default

    Thanks. You can't see any particular dis/advantage for me at this stage being with one bank? Or would this be a source of regret later on for some reason?

  4. #4
    Join Date
    Sep 2013
    Location
    Auckland
    Posts
    3,885

    Default

    Quote Originally Posted by wodger View Post
    Thanks. You can't see any particular dis/advantage for me at this stage being with one bank? Or would this be a source of regret later on for some reason?
    It's ok to stick with one bank for now. After 4 or 5 properties then start looking for another bank.

    You can always refinance 1 away from kiwibank to a new bank some time later.

  5. #5
    Join Date
    Jul 2012
    Location
    Tavua, Fiji
    Posts
    3,347

    Default

    The whole reason wodger is for risk minimisation. Plenty of people stick with one bank and are fine. So it's really more about a left field event taking you down or something unusual.
    In my case when the GFC hit I had loans with 11 banks so was not super exposed to any one. This gave me more options and flexibility in sorting things out. If I had been with one or two banks we would have lost absolutely everything instead of only losing out ot the banks who treated us like sh*te if that makes sense.

  6. #6
    Join Date
    May 2009
    Location
    NZ
    Posts
    99

    Default

    Yeah, that's what I thought this was about. Kiwibank is happy to lend to me at the moment and it keeps it simple for now. Our fallback is for my wife to go back to work (early childhood) which would increase our ability to service dramatically if we needed a boost. My job is secure.

  7. #7
    Join Date
    Jul 2012
    Location
    Tavua, Fiji
    Posts
    3,347

    Default

    Just dont forget if you get the bug and keep buying start using other banks. You want to be with Westpac and BNZ I have found them great for investors over the years especially if things go wrong.

  8. #8
    Join Date
    May 2009
    Location
    NZ
    Posts
    99

    Default

    Noted, thanks!

    I've already got the bug. My wife and I have talked about getting into this for years and are finally doing it. With her being off work and us having little kids, we just have to pace ourselves. Getting two at once like this is about as much as we can stretch to.

  9. #9
    Join Date
    Jul 2012
    Location
    Tavua, Fiji
    Posts
    3,347

    Default

    It's amazing how creative you get once you have the virus. I bought 20 in one year after I bought the first 1. Mind you we had no doc loans then it was oh so easy!!!

  10. #10
    Join Date
    May 2009
    Location
    NZ
    Posts
    99

    Default

    Quote Originally Posted by Damap View Post
    It's amazing how creative you get once you have the virus. I bought 20 in one year after I bought the first 1. Mind you we had no doc loans then it was oh so easy!!!
    Noob question, but how on earth do you buy them so fast? I would be happy to get 1 or two per year. I realise the first mistake is buying ones you have to "top up" but it's hard to find any other kind (browsing on trademe anyway). But considering I'm maxed out with kiwibank, if I wanted to buy just one more this year, how would I do it?

    Cheers


 

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