The most common way that first home buyers in NZ finance their property is with a home loan (mortgage). Loans can be obtained from big banks, through a broker or through your build company. Common mortgage types include:
● Fixed term - An agreed interest rate is paid over a set time period
● Variable - No agreed interest rate/time period, higher rates but more flexible
● Offset - Your savings are offset against your mortgage balance so you do not pay interest on the full balance of your mortgage
● Revolving credit - Your pay and mortgage are transacted in the same account with interest calculated daily. You have the ability to make lump-sum payments and redraw money at any time
Generally the mortgage Term will be 20 to 30 years. The larger deposit you have upfront will reduce the amount of interest you pay and the length of the loan.