Kāinga Ora’s First Home Loan Scheme
Homeownership in New Zealand: A Pathway to Your First Home
In today’s market, with rising interest rates, the high cost of living, and even higher house prices, saving for a 20% deposit can feel overwhelming. However, there is hope. Homeownership is becoming more achievable for Kiwis through the support of initiatives like Aarit Finance and our expert guidance with the Kāinga Ora First Home Loan scheme.
Support for First-Home Buyers
The First Home Loan scheme, introduced by Kāinga Ora, lowers the deposit barrier, making homeownership accessible to first-time buyers. With a deposit as low as 5%, this scheme can help you get closer to securing a mortgage and purchasing your first home.
Lower Deposit, Same Opportunity
While most lenders in New Zealand require a 10-20% deposit, Kāinga Ora’s scheme allows eligible buyers to get a mortgage with just a 5% deposit. With Kāinga Ora underwriting the loans, lenders are more willing to approve mortgages for buyers with lower deposits, giving you access to opportunities that might otherwise be out of reach.
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Eligibility Criteria
To qualify for the First Home Loan scheme, you must meet specific criteria:
For single buyers without dependents, your income should not exceed $95,000 in the past 12 months.
For those with one or more dependents or joint buyers, your combined income must not exceed $150,000.
You must provide at least a 5% deposit, which can include savings, KiwiSaver withdrawals, or a gift from family.
You must plan to live in the property for at least six months, as this loan cannot be used for investment purposes.
Applicants must be over 18, with no ownership of other properties or land.
There are no price caps on the homes you can purchase, but your household income must still not exceed $150,000 annually.
Important Considerations with the Kāinga Ora First Home Loan Scheme
Lenders’ Mortgage Insurance (LMI)
Borrowers pay a one-time LMI fee, usually 0.5% of the loan amount. For example, a $200,000 loan will incur a $1,000 fee, which can be rolled into the loan for more convenient repayment.
Limited Lender Options
Not all banks are part of the scheme, which means your choice of lenders may be limited. However, there are still many available options to help you secure the best loan for your needs.
Eligibility Restrictions
The scheme primarily targets first-time buyers with a household income cap of $150,000, though certain multi-generational households or large families may qualify even if they exceed this limit.
Applying for First Home Help
At Aarit Finance, we offer expert guidance through every step of the First Home Loan process. We work directly with banks to match you with the most suitable lender. Our advisors stay up-to-date on each bank’s criteria, ensuring you don’t waste time applying to lenders that don’t align with your needs.
We can also assist you with pre-approval, giving you confidence in your ability to move forward when you find the right property.
Understanding the Repayment Process
Once you qualify for the scheme, our team at Aarit Finance will guide you through the repayment terms and ensure you understand your financial obligations. We’ll provide the clarity and support you need to make informed decisions about your loan and home-buying journey.
Taking the Next Step Toward Homeownership
Buying your first home can be daunting, but with the First Home Loan scheme and Aarit Finance’s support, you can achieve your dream. We’ll handle the complexity of the loan application, making the process as seamless and stress-free as possible, so you can focus on stepping into your new home.
Contact us today to learn more about how we can help you navigate the First Home Loan scheme and make homeownership a reality.
Applying for First Home Help
At Aarit Finance, we offer expert guidance through every step of the First Home Loan process. We work directly with banks to match you with the most suitable lender. Our advisors stay up-to-date on each bank’s criteria, ensuring you don’t waste time applying to lenders that don’t align with your needs.
We can also assist you with pre-approval, giving you confidence in your ability to move forward when you find the right property.