Article: Law & Finance

Why 2017 Will See More People Using A Mortgage Adviser with Carie Townley

2016 was an outstanding year for the mortgage industry with interest rates hitting an all-time low, making it a labyrinth for New Zealanders to borrow. Constant changes to lending have been a contributing factor to why more and more people are using a mortgage adviser when it comes to purchasing real estate. Consumers want someone who can help maximise their chances of securing the property they’re after with minimal work involved. With so many different options out there, why are mortgage adviser services now more sought out than ever?

They Do The Leg-Work
Being in the market for property can be an overwhelming experience at the best of times, and having someone do all the research, negotiation and working out the nitty-gritty of the paper work can make a world of difference. In fact, for some, that is all the difference. Having an adviser do the groundwork will both facilitate the process and save the time that most people don’t have, these days.

Using a mortgage adviser, means having an expert who is familiar with the market and because they know what each lender looks for [and doesn’t], are in a position to give the borrower a more tailored solution to their circumstances and needs.

The Relationship
The relationship with a mortgage adviser is a long-term one. Long after the exchange of documents and settlement, they are still there to support, answer questions or even assist with another property. Because purchasing real estate is a long-term investment, it’s important to know that there’s a trusted adviser right there, all the way.

Ultimately, a mortgage expert is there to provide unbiased advice, independent of any bank or financial institution. Their role is to educate and always have their customer’s best interest first.

Market Update - Rapid rate rises for NZ
What’s prompted the spike in interest rates?
New Zealanders have seen a recurring hike in interest rates, thanks to changes in legislation and The Reserve Bank powers, which has led to the banks holding more capital for investment lending. This means they are now facing a shortfall and having to borrow more money from offshore sources. Internationally, rates have also been going up, making it more costly to borrow.

People have not been investing cash in the bank recently because of the low interest rates, so the banks are now increasing investment rates to try to attract some of that money back. However, this means they also have to charge more for lending money in an attempt to regain balance.

Why are the smaller banks able to keep their rates down while the big banks are increasing theirs?

The smaller lending institutions have a smaller lending base and therefore need less capital. They aren’t lending as much as they aren’t considered mainstream. Typically, most people tend to go to the big four banks. However, as they attract more lending, they potentially won’t be able to keep increasing their rates.
In an ever-changing market where each bank operates differently, it’s important that clients have choice. Consulting with a mortgage broker can make them aware of what is available for their financial situation.

For a personal mortgage reduction analysis to identify the strategies that are in your best interest, contact Carie today on 0275 228 940, email .(JavaScript must be enabled to view this email address).

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