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Mortgage requirements part 2: Am I eligible for the Welcome Home Loan?

As you might already know, you need a minimum deposit of 20 percent to secure a home loan in New Zealand.

However, there are some key exceptions. The Welcome Home Loan is one of them.

What’s the Welcome Home Loan all about?

The Welcome Home Loan is a mortgage product for individuals or couples with modest income. If you meet the eligibility requirements, you can access a Welcome Home Loan with a deposit of just 10 percent.

Housing New Zealand makes up the shortfall by providing lenders mortgage insurance to participating lenders, thereby reducing the financial stress on you, the borrower.

Lenders currently offering Welcome Home Loans include:

  • Westpac
  • TSB Bank
  • Kiwibank
  • The Cooperative Bank
  • SBS Bank
  • NZCU Baywide
  • NBS

Offers can vary between providers, so remember to always compare NZ mortgage rates in order to save on interest.

Am I eligible for the Welcome Home Loan?

You must meet the following criteria to apply for the Welcome Home Loan:

1. Modest income

Individuals can have a maximum yearly income of $85,000 (before tax). If you’re buying a house with friends or your partner, you can have a combined maximum yearly income of $130,000 (before tax).

2. Deposit of at least 10 percent

You’ll need a deposit of at least 10 percent of the property you’re planning to buy.

3. New Zealand citizen

You must be a New Zealand citizen or a permanent resident.

4. Buying below the price cap

Finally, the cost of the house you wish to buy with a Welcome Home Loan must be lower than the regional house price cap. This is set at $600,000 for Auckland homes ($650,000 for new properties), $500,000 in most urban parts of the country ($550,000 for new properties) and $400,000 everywhere else ($450,000 for new properties).

Check out the official Welcome Home Loan website for more details.

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