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
Navigating Mortgage Approval During Relationship Breakdown
Financial separations are challenging enough—add self-employment to the mix, and you're facing a uniquely complex situation. This episode dives deep into a fascinating case study that demonstrates how self-employed individuals can successfully navigate mortgage approvals during relationship breakdowns.
We follow the journey of a café owner who, despite the hospitality industry's rollercoaster ride through COVID and economic downturns, managed to secure mortgage approval from three major banks. The secret? Strategic business decisions clearly communicated to lenders. While her financial statements showed the inevitable ups and downs of recent years, her ability to articulate her business strategy and future profitability made all the difference.
The story takes an interesting turn when we explore the implications of New Zealand's Relationship Property Act. Despite owning her home before entering the relationship, our café owner found herself needing to buy out her former partner's 50% entitlement after their separation. This case highlights the critical importance of understanding property rights in relationships and potentially safeguarding assets through contracting out agreements.
What really stood out was the human element of financial advising. During emotionally charged life transitions, having responsive advisors who understand both the financial and emotional aspects makes a world of difference. Our team-based approach ensured someone was always available to respond and support the client through every step of this challenging process.
If you're self-employed and facing similar challenges, or simply want to better understand how property rights work in relationships, this episode offers valuable insights and practical advice. Subscribe to our YouTube channel and follow us on Instagram to stay updated with more financial guidance that speaks to life's complex situations.
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Hello, and welcome back to that Home Loan Hub. If you're self-employed, this is the episode for you, and if you're going through separation, this is the episode for you too. So stay tuned in. I've got my resident James here. Hello, james.
Speaker 2:Hey, how's it going.
Speaker 1:Wonderful. Thank you, james. You've got a really cool case. I've been working on that case for the last few years and you've now been the lead on this case for me, because I can't be in 100 places at the same time and it's nice to share the love. So, james, let's talk about this wonderful, wonderful case that we have okay.
Speaker 2:so it's actually one of two separation cases that I'm situations I'm working on and you know it's a really stressful thing to go through for the people involved. So it is. It's pretty cool to be able to help them. So in this situation we've got a person who's self-employed and has been self-employed for say, seven or eight years, I would say at least that business has gone through its ups and downs, and certainly during the COVID period, it's hospitality right.
Speaker 1:This client owns a cafe hospitality industry. So very tough times over the last few years after the COVID and then the recovery and the downturn in the economy. So she's seen it all.
Speaker 2:Yeah, absolutely. But we were able to show that. You know, we showed all the financial statements from the last few years to the banks or the lenders and you know she can show. Initially the banks had some queries because it didn't look like the business was quite doing as well as what it had done. But she was able to show that she's actually made some strategic decisions around her business to make it more profitable. And as soon as we were able to show that and provide evidence in the financial statements, she pretty much got approval from three out of four banks, of the main banks that we were going after.
Speaker 2:And it's a unique case because she already owns the house. She's a co-owner, I guess is that the word that we use Co-owner Co-owner of the house with her previous partner. She owned the house before they got together. So they, you know, and there's lawyers involved in all that kind of stuff. So it's going to be such an ideal solution if we can get her to own that house freehold herself not freehold, sorry get the lending she needs to take over that entire mortgage and if you've missed my episode on Relationship Act, I've done a webinar with Paulina and we've covered around you know the relationships and the factor relationships and things like that.
Speaker 1:So even if you own that property but you didn't have a contracting out agreement, then you know whatever is yours is theirs 50-50. So unfortunately, even though she owned the house and the partner came in to live with her, contributed maybe to the mortgage. A little bit, you know. But then after three years, if they separate effectively, the partner can claim 50% of the property.
Speaker 2:Yeah.
Speaker 1:So this is where we needed to help the client to borrow a little bit extra to pay out the partner and hopefully, you know that will sort out their financial separation and make it easy for them going forward, because they still have parents to sorry children to co-parent together and they children to co-parent together and they want to co-parent in the nicest way possible.
Speaker 2:Yeah, it's been a pretty long journey by the sounds of it, but it feels like we're getting pretty close to sealing the deal.
Speaker 1:Yeah, yeah. But the main takeaway for those that are self-employed here is the banks do want to help you. You know we want to help you and we want to see you get ahead in life. So for us, in order to understand your situation, we need to understand your business. We need to understand what you've been doing in your business to improve your position, even if the financials don't look that flash in the last few years, but going forward they look better. We need to understand what you're doing.
Speaker 2:Absolutely.
Speaker 1:That we can convey that message to the banks, because the banks need to be confident in what you're doing.
Speaker 2:Absolutely, and that's what got this one across the line.
Speaker 1:Yeah.
Speaker 2:So just having those extra insights that the owner was able to share with me, you know and communicate really clearly to the bank, yeah, and it was good, absolutely, absolutely.
Speaker 1:Thank you, james. Communicate really clearly to the bank. Yeah, and it was. It was good, absolutely, absolutely. Thank you, james. This is a really, really powerful story to share, because I think a lot of the time, you know when we, when we're doing deals, we're dealing with humans we're dealing with their emotions. We're dealing with their lives.
Speaker 2:We get fully entangled yeah, it's a and they and they, and I think they really appreciate that we understand their stress.
Speaker 1:Yeah, do you know what I?
Speaker 2:mean and that we do everything that we can in terms of communicating with them keeping in touch.
Speaker 1:Yeah, I think that's quite highly valued. Yeah, and I think what was really important in this case is that we were team tagging. Yeah, you know, when I was away, you were responding when you were away.
Speaker 2:I was responding.
Speaker 1:So the client felt like they were looked after really, really well when you don't have that support around you as an advisor. I remember back in the day, you know, when I was first starting out, it was just me. I had to be on 24-7. I felt like I could never take a break because I needed to be there for my clients. So I feel like I'm in a very fortunate position right now, having such an awesome team around me between you and Kunj and a few others. You know we're always team tagging.
Speaker 2:It is really good because I know you do get pulled into meetings. You know I was traveling that day. I think it was really hard to you know, we're not supposed to check our emails while we're driving, so it was really cool. When I got home it was all sort of pretty much sorted for me. You know the questions.
Speaker 1:Yeah, fantastic, awesome, james. Thank you so, so much. And just a reminder if you've missed the episode on Relationship Property Act, please go back and have a look. I've got a YouTube channel and what would really help me if you guys could subscribe to my YouTube channel. We're trying to lift our subscriber views because that really helps to get our message across, and what would really also help is, if you're on Instagram, please find me on Instagram and follow me. I am few followers away from a thousand and apparently I need a thousand followers to start doing live videos, so if you could help me by following me not in real life, just on social media.
Speaker 2:I'll do that.
Speaker 1:Always creeps me out that word. I'm usually not the one to ask, but in this instance I feel like what we do is important and we do want to spread that message across. So, if you can, please follow me on YouTube and Instagram. That would be most appreciated. Thank you and bye.
