Speaker 1 0:10

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

Welcome and Previous Episode Recap

Speaker 1 0:20

. 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 0:45

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 0:55

Mm-hmm . So they've got

House Hunting Begins

Speaker 1 0:56

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 1:08

That's why I did it . It's the fun part . House shopping yeah , For some people it can be quite stressful .

Speaker 1 1:12

So what can we do to help them out in that process ?

Speaker 2 1:15

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 2:08

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

Working With Real Estate Agents

Speaker 1 2:24

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 2:44

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 3:34

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 3:43

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 3:54

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

Making an Offer on a Property

Speaker 1 4:04

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 4:28

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 4:43

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 5:30

Would you agree , never , ever , date the sales .

Speaker 1 5:32

What did I say ? You said sign , oh dear yes , never , ever date , don't date it until the vendors sign it .

Speaker 2 5:38

Well , at least you're listening .

Speaker 1 5:40

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 5:55

So

The Role of Lawyers

Speaker 2 5:56

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 6:35

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 7:12

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 7:45

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 8:24

Oh , okay , did you know that ?

Speaker 1 8:26

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

Conditional Approval and Next Steps

Speaker 1 8:58

. 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 9:09

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 9:16

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 10:06

Yeah .

Speaker 1 10:06

So just make sure you're aware of it , that you're not just , you know , having a heartbreak in that moment .

Speaker 2 10:13

Well , it's a possibility , but… Really happens . Yeah , really happens . I don't think I've actually seen it happen yet .

Speaker 1 10:22

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 10:36

Yeah , and the bank will use the lower of value as well .

Speaker 1 10:40

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 10:51

Thank you Bye .