That Home Loan Hub
Welcome to That Home Loan Hub, your ultimate guide to mastering the world of home loans and property. I'm Zebunisso Alimova, here to simplify the complexities of real estate and provide you with expert insights and the latest trends.
Whether you're a first-time homebuyer, an experienced investor, or simply curious about the property market, this podcast is for you. Join me each week as we unlock the secrets to property success and help you make informed decisions. Let's dive into the world of property together!
That Home Loan Hub
What Nobody Tells You About Making an Offer on Your Dream Home
Found a house you love but not sure what happens next? The excitement of house hunting can quickly turn to confusion when it's time to make an offer. In this practical episode, we demystify the crucial steps between getting pre-approval and making an offer on your dream home.
House hunting should be fun, not stressful! We share actionable tips to streamline your property search, from creating a prioritized checklist of must-haves versus compromises to leveraging websites like Trade Me and building relationships with flexible real estate agents who can accommodate your schedule. Can't make that Sunday open home? Don't worry - we explain how agents can often arrange private viewings that work around your availability.
The offer process itself comes with potential pitfalls that can trip up even the most prepared buyers. We reveal one of the most overlooked yet critical errors people make when signing sales and purchase agreements - dating the document before vendors sign! This simple mistake could cost you valuable days on your finance conditions. Plus, we explore the complexities of using KiwiSaver for deposits (not all lawyers handle this the same way), how to choose the right property lawyer, and what happens when your offer is accepted and moves to conditional approval.
Ready to navigate the property market with confidence? Listen now, and be sure to stay tuned for our next episode where we'll explain what happens after your conditions are met and you go unconditional on your property purchase. Want our comprehensive house buying guide? Reach out directly and we'll send it your way!
Welcome back to the episode of Conch Cares. Hey, conch Kia ora. So we've been doing some awesome mahi here for the last few weeks. We've been talking about what happens when you buy a house. You know the process of getting the house and we're just breaking it down down to the basics so everyday New Zealander can understand us. Yep, now, in the last one we talked about what happens when you get your pre-approval offer. There might be some conditions and what happens you know in there Now the client has the pre-approval.
Speaker 2:They looked at the conditions. What's the next step? Well, I thought this episode will go through. Start to look for house. So that's the fun part house hunting and then like making an offer on the property.
Speaker 1:Mm-hmm. So they've got the pre-approval. It tells them the amount, how much they can borrow plus the deposit, gives them an understanding of the purchase power. So they can go window shopping, house shopping.
Speaker 2:That's why I did it. It's the fun part. House shopping yeah, For some people it can be quite stressful.
Speaker 1:So what can we do to help them out in that process?
Speaker 2:Well, I guess it's for them to work out where they want to live, the size of the house, what is a must and then what is a compromise. Work out how close you want to be to work and things like that. New Zealand has some really good websites that you can jump on and have a look and find those types of properties that you're looking for. So one obviously being Trade Me. Those are the ones that people jump on or contact your local real estate agent. Mostly agents can show. If you can't make Sunday viewings because I think most open homes are on Sundays agents can show you around the property after hours and things like that. I think agents are like mortgage brokers. They kind of work 24-7.
Speaker 1:Yeah, I guess you know in their mind they're trying their best for the vendor to sell the property and to help the buyers to find the right property. So there is a bit of flexibility there. So if you do see a property and it says open home only between you know one o'clock and two o'clock on a Sunday don't be put off by that, especially if you are working on those Sundays Do contact the agent, don't be afraid, don't be shy, and they might find another time for you to view the property. But they're absolutely, I think, going through the checklist and I have prepared a handy guidebook as well. A few years ago that a lot of my clients have been….
Speaker 1:We might need to pull that guide out again eh yeah, find it useful that it's got various checklists. It's got various, you know, and all the steps are broken down into every single step what happens there. So if you guys want that guide, please reach out. We'll email it out to you. If you're just tuning in and you don't know who we are, we're here to help you to make your dreams come true. So the power of our relationship with agents come into play as well. I think and this is where you know if you are using a mortgage advisor or a banker ask them if they know any agents that they're working with, because we know a few and we've interviewed a few over the last wee while and they talk about how they are able to help the buyers, because buying and navigating I think the buying process can be very confusing.
Speaker 2:Yes, very daunting as well, because you're like okay, I found this house, I really like it. What do I do next?
Speaker 1:Yeah, and it comes up a lot because you know some houses go on auction. Yes, Some houses go on Tinder Deadlines. Yeah, you know by inquiry only Like, what do you actually do at each of?
Speaker 1:those different processes and a lot of questions we also get is can I put an offer on more than one property? You know. Can I put an offer here and then pull out you property? You know, can I put an offer here and then pull out? You know things like that. So again, this is something for you to discuss with your lawyer. You know, and with your advisor, at where you stand, what conditions you're using to buy. So our power comes in is explaining to you how the sales and purchase agreements work. Sometimes the agents do that, we do that, the lawyers do that as well. So hopefully you understand what goes on on the front page of the sales and purchase agreement.
Speaker 2:Yeah, I mean there's a lot of professionals around to help with that side of things. So you've got the advisor, you've got the agent and then you've got your lawyer to help you make that decision and submit an offer through.
Speaker 1:Exactly that decision and submit an offer through Exactly so. One of the tips that we normally share is do not date the sales and purchase agreement when you're signing it, because you sign it first. You put an offer, then it goes in a normal, let's say, case outside of auctions, then it goes to the vendors to sign and they might take a couple of days to think about it. Absolutely so, if you put a date on it, then it activates your conditions. So, for instance, if you put 10 working days for finance condition, because we may have to take that sales and purchase agreement to the bank and get the bank's approval, if you date the sales and purchase agreement and the vendors don't sign until a few days later, we've lost a few days straight away. So please never, ever, sign the sales and purchase agreement until it's been fully signed by the vendor.
Speaker 2:Would you agree, never, ever, date the sales.
Speaker 1:What did I say? You said sign, oh dear yes, never, ever date, don't date it until the vendors sign it.
Speaker 2:Well, at least you're listening.
Speaker 1:That was a check if you guys are actually listening, so hopefully you find this one funny, awesome. So we've covered that off. And then, okay, they sign the sales and purchase agreement. Do they sign with the lawyer, does it go to the lawyer, or what happens next?
Speaker 2:So if they found a house and they want to make an offer, they sign or they offer it through the agent with signing a sales and purchase agreement. The agent usually presents the sales and purchase agreement through to the vendor. The agents will actually ask who your lawyer is as well. So be sure to have a lawyer ready when you're making your offer as well, and if you need help with finding a lawyer, we also can connect you to a lawyer. Well, most advisors can connect you to a lawyer as well or make recommendations. So can agents as well.
Speaker 1:Yeah, or just jump in on Google, facebook pages, et cetera. Ask around your local community groups. You know, support local if you've got any cool lawyers around, and this is, I guess, again where our power comes in. We've got a few cool people that we work with and we recommend. And the tip here would be from my side is, if you are talking to lawyers, find out upfront what the cost will be. You know whether they charge you for every single offer that you make to review the contract, whether they can do a package for you, whether they can review a couple of properties. You know, and then you just pay for one once it's successful. So every lawyer is different.
Speaker 2:Yeah, and also ensure that the lawyer is a property conveyancing lawyer. There's so many different specialties of lawyers as well, so you'll need a property lawyer that does conveyancing Also. Just ensure I guess this is for more complex loan applications, where there's guarantees involved and stuff. Some lawyers may not be able to help with that side, so just ensure that they can do guarantees as well, if there is a guarantee related to your property purchase.
Speaker 1:Yeah, and the recent one we had which was really interesting, is the client doesn't have any cash saved for the deposit to go on when they have to go unconditional and we're going to cover this off a little bit later. What you put on the sales and purchase agreement down as a deposit is part of your deposit for the bank application. It's not separate, it's part of it. But if you don't have any cash saved up and you're fully relying on your KiwiSaver as a deposit, this is where it gets a bit trickier, Because some lawyers can withdraw your KiwiSaver earlier to use as a deposit and some would not.
Speaker 2:Oh, okay, did you know that?
Speaker 1:Yeah, because the lawyers actually have to give their own undertakings to KiwiSaver that they will keep your money safe. Correct, that they will keep your money safe, correct. So if your KiwiSaver goes walkabout and your lawyer has, you know, done something about it, then the lawyer will get into big trouble with KiwiSaver providers. Yeah, so that's why some lawyers don't like giving those undertakings and using your KiwiSaver as a deposit. So very, very important to note that down and maybe review and I think I did talk to maybe some of the lawyers who have done some episodes about KiwiSaver. So, yeah, would pay back, you know, to look back and review some of those episodes. So the pros of putting an offer would be.
Speaker 2:The pro of putting in an offer is securing a house. You found a house that you love and you really want to buy it.
Speaker 1:And the vendors agree to sell it to you. So the contract becomes under offer. Yes, and this is where we go back to the bank and we get a conditional approval for that particular property. So do we want to cover about the conditional approval? So now you're moving from pre-approval to conditional approval for that particular property, and what that means is that you found a property, you put an offer, it's under offer and we order valuation for you using the platforms. So I'm just recapping what we've just talked about, and the negative side, I guess, to it is that if, for some reason, valuation does come back and it's not satisfactory, it's not sitting where the bank needs it to be, sitting, then the problem with that is the bank may decline that approval.
Speaker 2:Yeah.
Speaker 1:So just make sure you're aware of it, that you're not just, you know, having a heartbreak in that moment.
Speaker 2:Well, it's a possibility, but… Really happens. Yeah, really happens. I don't think I've actually seen it happen yet.
Speaker 1:But we always put disclosure around it to make sure that people are aware that it may happen, because if you're buying something at $650,000 and valuation came back at $600,000, then the bank might turn around and say, look, you're overspending.
Speaker 2:Yeah, and the bank will use the lower of value as well.
Speaker 1:Exactly so. That's it. That's us for today, and we will be back with the next episode on what happens once you've satisfied all the conditions and you've gone unconditional. Stay tuned.
Speaker 2:Thank you Bye.