Home Loan FAQs
Frequently Asked Home Loan Questions
Is there a fee for your service?
In most cases no, as I'm paid by the bank, however if you don't qualify for mainstream lending and I arrange finance from a second tier lender a fee will be charged (this is included in the loan amount and only paid upon drawdown of the loan).
My work colleague said just go to the bank, there is no need to use a mortgage advisor.
Yes, you can go directly to the bank. You can even apply for a home loan online, however mortgage advisors have access to a wide range of home loan providers, all of which have different criteria. Advisors are generally more experienced and have handled more loans than bank lenders. I've been on both sides of the fence i.e. bank lender and mortgage advisor, and although it may sound a bit harsh, customers dealing directly with the bank can be treated as "just another number".
Wouldn't the bank be able to offer us a better deal if we go direct instead of using an advisor?
It is not unusual to think that as banks pay advisors, that they can "afford" to offer you a better deal if you approach them directly, however this is definitely not the case. Advisors are dealing with the negotiation of interest rates & incentives on a regular basis and therefore know what represents "a good deal".
Mortgage advisors are actually a very cost-effective channel for the banks, we are essentially contracting to them, and importantly for the bank they only pay on settled business. With their in-house lenders they have all the associated costs - salaries, holidays, IT, cars, phones, rent etc. It is not unlike a lot of businesses who have moved away from the risks of employing staff and are now utilising contractors. It is very noteworthy that one of the country's major banks, the BNZ, has recently started using brokers again after an absence of 13 years.
OK, so an advisor is the way to go, however why Darren Caldwell Home Loans? Wouldn't it be better to use a larger mortgage business?
I have been specialising in home loans for 20 years, and have arranged in excess of 3,000 of them - there wouldn't be too many mortgage advisors around with that much experience. I asked one of my earlier clients who found me on Google why he chose me when there are so many other options. He replied that most of the others appeared to be larger businesses with several advisors, and he thought by choosing a sole operator with his name on the business that he would receive a better and more personal service. I couldn't put it better myself!
I don't view clients as a one-off transaction. I look at it as a long term mutually rewarding relationship where I take care of your evolving lending needs - from arranging a top-up for a consumer item/holiday/home improvements etc to assisting with selling/buying or the purchase of an investment property.
How do you provide your advisory services?
I am not limited by location and have vast experience providing valuable advice and assistance to customers throughout New Zealand. Everything can be arranged by email and over the phone.
If you are in the Canterbury area, I am more than happy to meet with you in person, either at your home or workplace as required.
Can you assist with other services, such as insurance?
I offer a product called Mortgage Interruption Cover, however if you're interested in discussing more comprehensive insurance products (e.g. income protection, trauma etc) I can refer you to a specialist insurance advisor. I am also happy to provide referrals for:
- General insurance
- Building Inspectors and report providers
How do I know what I can afford? / Can you help me find out what I can afford?
Yes, I have a software package which shows approximately how much each of my panel of lenders would be prepared to lend you. Also, importantly, we will discuss your level of comfort which may be somewhat less.
What information do I need to provide?
This can vary however generally we require confirmation of income, three months statements on your accounts, confirmation of your deposit + photo ID.
How much deposit do I need?
20% is ideal to avoid additional costs, however it is possible to purchase with as little as 5% (the 5% must be genuine savings).
Do I need a lawyer?
Yes you do, if you don’t already have a lawyer I can recommend one for you.
Can I get pre-approval?
Yes, I encourage clients to obtain a formal pre-approval before commencing house hunting.
Should I select a fixed or floating home loan interest rate?
Both have advantages/disadvantages. There are other options too e.g. capped/revolving/offset. We will discuss in more depth during the process.
What can you provide home loans for?
New purchases, refinancing, new builds, first homes, investment properties, debt consolidation, top-ups for consumer items.