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Mortgage Advice Blog

Get the latest news and tips about mortgage finance and the property market. Scott Miller, mortgage broker from Advanced Mortgage Solutions comments on housing and lending.

June's Property Gazette

Published by Scott Miller on Friday, June 02, 2017 in

Choosing Between an Interest Only & a Principal and Interest Home Loan

It’s plain and simple, there is a lot of options out there when it comes to home loans. What’s not so plain or simple is choosing the right one for your circumstances. As mortgage brokers, part of our job is to help you obtain the best mortgage for you and that includes repayments too. We understand the different loans like the back of our hands and want to make sure you do too.

Today we’re looking into the differences between an interest only loan verses a principal and interest loan. Both have their pros and cons and both suit different people at different times in their lives. Let’s dive in and learn some more about them …

What’s an Interest Only Loan?

An interest only loan is when your repayments only pay off the interest your loan has accumulated, not the actual principal or amount you’ve borrowed. This means your loan does not get smaller over time, but you will have smaller repayments to make as principal repayments are not added. The amount of interest you are charged stays the same, as you are no reducing the amount of your loan.

What’s a Principal and Interest Loan?

A principal and interest loan is when your repayments cover the cost of the interest your loan has accumulated, as well as a small piece of the principal. Initially, the principal repayments are very small and the interest large. But as time goes by, your interest is lower as the amount of your loan becomes smaller.

Should I Pick a Principal and Interest Loan or an Interest Only Loan?

First up, you need to consider why you’ve got the loan in the first place. If you are an investor and your rent covers your mortgage with maybe a little left over, you may be quite happy not to reduce the size of your loan. Investors often benefit financially when they sell the property, which they see as the long-term goal.

But if you are a home owner, your goal is often to end up owning your home mortgage free. Obviously the early you repay your loan the better, with less interest being paid overall and being able to keep the loan repayments in your pocket, not your lender’s.

While both loan options are valid choices, the main thing to consider is whether it’s important to you to lower your loan amount or not. If you just pay the interest only, you won’t be gaining equity in your property.

We’d love to chat with you in more detail about the pros and cons of both loan repayment options. One of the things we have help you with is a rapid mortgage reduction. We can show you how to reduce the length of your mortgage, helping you save thousands in interest costs.

Introducing…..Mortgage Interruption Cover

You have a home which is insured, but is your Mortgage Insured? It probably should be, as there are many events in life such as Illnesses, accidents, and job losses which can put your ability to pay your mortgage in jeopardy.

Now, we have a cost-effective and straight-forward solution that does not need intensive medical underwriting and won’t cost you a fortune. And it’s all designed to protect you & your future should something serious occur. 

It’s called Mortgage Interruption Cover, it’s new and it’s potentially a game changer in terms of allowing everyone to have access to cover easily & affordably.

We would like to offer you the opportunity to see how this can benefit you, to find out more please contact us today!

April's Property Gazette

Published by Scott Miller on Friday, March 31, 2017 in

Broker or a Bank? Your Successful Mortgage Guide

Have you noticed that Easter is just around the corner?

We have welcomed many new clients during the past month. Our new clients decided to choose us as their mortgage broker instead of talking to their bank. Let us tell you why …

Why Choose a Broker Over the Bank?

A bank adviser can only sell you products from their bank. While they may offer a few different rates, they cannot offer you the same range of rates or products as a mortgage broker can. A mortgage broker works with many different banks and lending institutions to get you the best deal available.

It’s true that some banks do not offer as many products as other banks. It also gives them the chance to sell additional services, such as insurance, credit cards and personal loans.

A mortgage broker, on the other hand, knows what is happening with the whole market, not just at one bank. They’ll be able to tell you which lenders work best with borrowers who are looking to purchase their first home, an investment property, with bad credit history or who is offering the lowest rates. A broker also does all the leg work for you! After all, it is no fun filling out an application form for every bank you approach.

You can even start applying for your mortgage right now on our website. Head over now to Apply for Your Home Loan.

Banks Verses Mortgage Brokers – Who Will Win?

It’s the age-old battle, bank verses broker. Which one will you choose?

With banks, it pays to shop around to make the right choice for you. Make appointments, ring them on the phone, send emails and check out their websites. Of course, that all takes time.

Or you could call us instead. We’re your one stop mortgage shop. We’ll do all those emails, phone calls and appointments for you. One of the major benefits of working with us, other than getting you access to the best rates around, is we do all the work for you.

We’ll also work with you towards getting your first home if you are not quite ready. We want you to get the home of your dreams and sometimes a little more planning is required..

Head over to our website and read about the five ways we will make getting the best home loan for you quickly and simply. Or if you’re ready to apply now, give us a call now on 0508-466-356 for free and confidential mortgage advice.

Mortgage Protection – Are you covered?

Your home is the most expensive asset you will likely own, and most people wouldn’t dream of not having in insured.

However, the sad reality is that many people who own a home, do not have any income or mortgage protection cover in place to protect themselves for the day when they may be unable to earn an income due to accident or illness.

This is a leading cause of Mortgagee sales in New Zealand, and could be easily avoided with the right protection in place.

Mortgage Protection cover is affordable & is something that everyone with a Mortgage should consider. Talk to us so that we can show you the best options for your situation.

March's Property Gazette

Published by Scott Miller on Thursday, March 02, 2017 in

What’s up with rising interest rates?

As we begin to welcome the cooler weather during March, we are also starting to see higher interest rates creep into the market. This has happened even though the Reserve Bank has kept the Official Cash Rate unchanged. This year alone interest rates have gone up 5 times and although in small amounts, we are now seeing the 5 year interest rate up around .75% from their lows.

Why Are Interest Rates Rising?

Economists have stated that the Reserve Bank’s stance on requiring a 40% deposit for investors, as well as a general 20% deposit for owner-occupier home buyers, is the reason why the housing market is slowing down in some areas. Banks are also struggling to attract deposits from New Zealanders. This resulted in a monthly drop in bank deposits for the first time in three years. Thus, banks have had to head overseas for more funding to be able to continue to offer their borrowers money. This had led to borrowers being charged higher interest rates.

There is hope on the horizon however. As mortgage brokers, we can approach lending agencies on your behalf to get the best interest rates for your unique circumstances. It is this bargaining power we have which sees our clients getting lower rates when borrowing, compared to borrowers who approach banks directly.

You can find out more about the five ways we help you get the best interest rates for your home loan here. You’ll be amazed at how easy and quick it really is when you work with us!

Looking to Purchase Your First Home?

The Welcome Home Loan package is well known amongst first home buyers. But is it really that good? The problem is that it has been designed as a one-size-fits-all kind of package and as we know, that doesn’t work for everyone.

Here at Advanced Mortgage Solutions, we don’t use a cookie cutter approach with our clients. Instead we work with you to obtain the best borrowing rates and offers from multiple banks and lending institutions on your behalf.  We’ve created a free guide for first home buyers and this explains how you can buy a home with just a 10% deposit. We can also help you with alternative products to the Welcome Home Loan or help you with this loan package if it proves the best deal for you.

Who owns your Insurance?

Recently, two separate events have highlighted the importance of not just having the right insurance, but making certain the money gets to the right people when the worst happens.

In the first situation, a separated policy owner was critically injured, but his policy was still owned by his ex-partner, leading to a complicated & fractious situation as it was his ex-partner who was the recipient of the Trauma policy pay out and was the only person legally able to make the claim.

In the second case a divorced woman was also critically injured, and had recently removed her ex-husband from her policy. However, she had also gone a step further and instructed her lawyer to prepare a Power of Attorney document naming a relative as being able to act for her in the event she was incapacitated.

Unfortunately, she was badly injured in a car accident. Had she not appointed a Power of Attorney, it would have been very difficult for her to make a claim and receive a payment due to her incapacitation, which her relative was able to do for her to help financially with her long recovery process.

So – with Insurance, having it is crucial, but so is getting the right advice around ownership so that the money gets to the right hands when it’s needed.

As Autumn brings with it a slight change in the weather, we continue to look forward to helping you achieve your homeownership dreams.

Kind regards

Scott, Jason and Jo.

February's Property Gazette

Published by Scott Miller on Friday, January 27, 2017 in

How did it get to be February already?

Welcome to 2017, a year we are hopeful will be even better for you and your family! Whether you are buying your first property, an investment property or planning some renovations during the year, we are here to help you with all your mortgage needs. We’ll take the legwork out of finding the right mortgage solution for you, with our friendly service and jargon free advice.

Interest Rates Are on the Rise

We’re already seeing rising interest rates, with many banks increasing their fixed rates over the last few days. This goes on top of the rises towards the end of December, which now see banks offering fixed term rates higher than 5%.

Even though they are large lenders, most banks are unable or unwilling to negotiate on interest rates with their customers on an individual basis. However, they are more willing to provide competitive interest rates to the clients of mortgage brokers. As our client, we will negotiate on your behalf to achieve the lowest possible interest rates for your mortgage. Talk with us today and we’ll hunt out the most competitive interest rates for you.

10% Deposit for First Home Buyers

First home buyers are now able to purchase a property to live in with as little as 10% deposit. We work with lenders who participate in the Welcome Home Loan scheme to help you purchase your first home. As well as finding you the most suitable home loan for your circumstances, we can also help you with your loan application process. If you are considering applying with or are ready to purchase your first home, head over to our Welcome Home Loan information page to find out about the eligibility criteria and how much you can borrow. We also offer a free 1st Home Buyers Guide, so please get in touch and we’ll walk you through the application process.

Life Insurance – are you sorted for 2017?

Life Insurance is the cornerstone of a strong risk protection plan – nearly everyone needs it, and there is more to it than you may think.

Did you know for example that a good life insurance policy will pay out immediately after diagnosis of a terminal illness?

Did you also know that an increasing number of New Zealanders are using their life insurance pay outs to fund alternative therapies and treatments as well as to repay debt, travel and leave funds for their loved ones?

There are many benefits to having a discussion with us about Life Insurance, including that we work with the main Insurers to get you the top independently rated Insurance. We work to provide solutions at the best prices as well as giving you good advice.

If you have Insurance already we may be able to save you money on your premiums, and if you don’t have Insurance we can certainly help you identify how much you may need and what the best cover is for you.

Get in touch with us to make sure that your Life Insurance is something you won’t have to worry about in 2017.

To find more info, head over to our Life Insurance page, or contact our in-house Insurance Specialist Jason Haskins on 022 0189 178 or

We look forward to working with you over the coming months of 2017.

Scott, Jason and Jo

Mortgage Holiday packages and updated Insurance information

Published by Scott Miller on Friday, November 18, 2016 in

Updates to House Insurance and Mortgage Holidays in the South Island and lower North Island.



Lenders have now come forward with their assistant packages for those caught up in the recent earthquake events in and around the lower North Island and Upper South Island.

These assistance packages include mortgage holidays, which allows exiting clients to put a temporary hold on their mortgage repayments. Also available are temporary overdraft facilities to help individuals and business with cashflow. Although handy there are some things that people looking to complete this should be aware of.

Mortgage Holiday - The interest that would normally be charged is capitalised and added to your mortgage balance. This means at the end of the mortgage holiday period, the money you owe the bank has increased.

Overdraft facilities - These initially will have no to low interest components, however they will need to be paid back, so it pays to keep an eye on your spending if using one of these facilities.

NB: Please note these facilities are only available to those in the affected areas and is not available as a matter of course to those outside the affected areas.


I just wanted to give you a quick update on the Domestic Insurance front, following this week’s events.

The Insurance situation today is best described as ‘Cautiously Optimistic’, as Insurance companies are now allowing existing policies on homes to be transferred to the new purchasers.

Although the embargo for new  Insurance policies remains in force, this is an encouraging sign.  We are hopeful that the insurance market for greater Christchurch will be unlocked in the near future enabling new policies to be approved and issued.

As ever, please don’t hesitate to contact me for any assistance or advice.  

Call Scott on 021 343 648, or email 

Call Jason on 021 018 9178, or email

If you would like to discuss anything about Mortgages or Insurance, contact one of our friendly Mortgage Brokers today. Remember, we work for you and our services are always free.

Important updates relating to "House Insurance" in the South Island and lower North Island.

Published by Scott Miller on Tuesday, November 15, 2016 in

Important updates relating to "House Insurance" in the South Island and lower North Island.

I thought it would be a good idea to provide an update on the domestic insurance situation, following the large earthquakes earlier this week.

At this point, there is an embargo in place on new domestic insurance applications across our region. This applies to new house, contents, vehicle & boat applications and applications that have been approved but are not yet in place.

Please note that existing policies that are in place are unaffected and remain in force.

This embargo is expected to remain in force for the next few days while the risk assessment is completed. After this time we are hopeful that things in greater Christchurch at least will revert back to normal.

Because the domestic insurance market is temporarily locked it is paramount that existing policy holders do not let their cover lapse, so if you are a home owner please make sure of this.

For new home purchasers, we are confident that these restrictions will soon pass provided nothing further occurs locally.

All other insurance cover remains unaffected – in fact this is a great time to make sure your "Life & Mortgage Protection" cover is in place and that you have the right protection at the best possible price.

Please feel free to contact me if you have any questions at all or if I can be of any assistance.

Call Jason on 021 018 9178, or email

November's Property Gazette

Published by Scott Miller on Wednesday, November 02, 2016 in

Which is better? A bank or a broker?

Should You Choose a Bank or a Mortgage Broker?

How do you choose between working with a mortgage broker or a bank when it comes to your home loan? Does one have an advantage over the other? Who is more likely to get you approved for your loan? We believe it a mortgage broker and here is why…

Working with a Mortgage Broker

A mortgage broker works for you and not a bank. A mortgage broker works towards getting you the best home loan for your individual needs. They’ll do all the work for you, approaching the banks and other lending institutions on your behalf, hunting for the best deal possible. 

A mortgage broker specialises in their area. They know about which lenders offer which packages and how to get a mortgage if you have a low deposit or poor credit rating. You also don’t need to pay a broker for obtaining a loan for you, that comes from the bank! So, you end up saving time and money just by working with a mortgage broker.

Working with a Bank

It would be considered the traditional way of securing a mortgage, however things are changing. Approaching a bank directly is not the best way of getting a home loan nowadays. In fact, it is often more than one bank you’ll need to meet with and who has time to talk to all the banks?

Work with Advanced Mortgage Solutions

We’re mortgage brokers. We work for you, not for a bank. Our team of brokers have access to hundreds of products and dozens of lenders. This allows us to find the best possible fit for you. A mortgage is not only a sharp interest rate – the structure of the loan, allowing extra repayments with no penalty, or having a loan structure that best protects you from increases in interest rates are the way to go. Contact us today and let us make things easy for you by arranging your next home loan.


We all need it, and we can all benefit from having expert advice.

Like mortgage brokers, insurance brokers are here to help you, and like mortgage brokers they have access to hundreds of products and dozens of insurance companies.

How much do we need? What are the best products for our situation? Are we paying too much for our existing cover... it can be very complicated!

That’s why we are now offering all of our clients the opportunity to get the right cover at the right price via our In-House Insurance Adviser, Jason Haskins

With more than 25 years in the Finance industry, including at Senior levels both Overseas and in New Zealand, Jason is very skilled at understanding what is important to the clients he meets, and is able to save you both time & costs.

For several years Jason was also responsible for training new financial advisers across New Zealand, and is able to give you advice on all aspects of Insurance.

Call Jason on 021 018 9178, or email

October's Property Gazette

Published by Scott Miller on Thursday, October 13, 2016 in

Yes! You Can Borrow with a 5% Deposit.

We’re excited to announce that our clients can now access 5% deposit mortgages for owner occupied builds! This means that if you have ever thought that building is for you, there is no better time than now. With the Reserve Bank requiring banks to approve lenders with 20% deposit or more, this has left many would be homeowners stuck renting or flatting. The shortage of available properties on the market has only continued to fuel rising house prices, with many first time buyers becoming discouraged at the huge competition when making an offer on a property. This has made building your own home more appealing.

New builds were not often seen as viable choices for many buyers, especially first home buyers. Many people were unable to pay both the rent where they were living and the repayments for the mortgage as the home was being built. However, if you are a first home buyer, you can utilise both your KiwiSaver and HomeStart Grant funds to make up your 5% deposit. This leaves you with the cash to pay your rent and mortgage costs until your new home is built.

Investors need not fret about obtaining the required 40% deposit needed to purchase a property, as we also have access to 20% deposit investment new builds too.

If you would like to discuss how the LVR changes affect you, or start applying for a new mortgage, contact one of our friendly Mortgage Brokers today. Remember, we work for you and our services are always free.

September's Property Gazette

Published by Scott Miller on Friday, September 02, 2016 in

Understanding New Loan to Value Ratio Changes

Recently the Reserve Bank (RBNZ) has tweaked NZ’s Loan to Value Ratio in an effort to stop rising property prices. As a result, they have set in motion a few new directives for banks which are compulsory from 1st September 2016. Other lending institutions such as credit unions are not affected.

Loan to Value Ratios and What They Mean

Loan to Value Ratio or LVR, is the percentage of money a bank will lend based upon the value of the residential property. A high VLR is being discouraged by the RBNZ for both owner-occupied and investment properties, in an effort to slow the housing market. That means:

·         Only 10% of the bank’s residential mortgage lending for owner-occupied properties within NZ, are allowed to have an LVR greater than 80%. This means that a deposit of at least 20% is required by the majority of buyers.

·         Only 5% of a bank’s lending for investment properties within NZ can have an LVR above 60%. This means investors now need to have at least a 40% deposit to buy a new residential property.

There are some exemptions to the LVR changes, where a lender may allow a higher LVR for a property, including the construction of a new property or a short term bridging loan. We are more than happy to chat with you and see if your plans qualify for an LVR exemption.

Get a Low Deposit Home with a Mortgage Broker

One of the key advantages of using a Mortgage Broker is that we are not a bank. We don’t make decisions about who can or can’t have a mortgage. Rather, we work for you and help you to get the right mortgage for your situation and often at a lower than advertised rate. This is also true for buyers who have less than the required 20% or 40% deposit to buy a home.

As we work with banks and other lenders every day, we know which ones are willing to lend on lower deposits and which aren’t. We approach those lenders on your behalf and explain why your mortgage should be approved. Occasionally a high LVR loan adds a low equity premium or low deposit insurance to your mortgage. If this is the case, we may also be able to negotiate a lower rate for you.

Finally, we are also able to help you get your foot on the property ladder with a low deposit home loan if you meet criteria for either the Welcome Home Loan, First Home Buyers Subsidy or use savings from your Kiwi Saver. You can find out more about the assistance for owner-occupied buyers with less than 20% deposit here. We also have a free First Home Buyers guide, which is proving exceptionally popular with our clients.

If you would like to discuss how the LVR changes affect you, or start applying for a new mortgage, contact one of our friendly Mortgage Brokers today. Remember, we work for you and our services are always free.

July's property Gazette

Published by Scott Miller on Friday, July 01, 2016 in

          It’s early days yet but economists agree that Brexit has upped                  the odds for the Reserve Bank to cut the OCR in August.

There has been a lot of news around Brexit and how it may affect the New Zealand economy. In my humble opinion the truth is nobody really knows what affect (if any) the exit of the UK from the EU might have on our or the world’s economy.

The best advice I can give is contact Advanced Mortgage Solutions if you feel the time is right for you to take advantage of record low interest rates. I am not saying interest rates are about to go up, but I am saying there is a little uncertainty out in the market place.

Typically, in times of uncertainty the cost of funds (the price the banks purchase money) go up as the cash wholesalers around the world build in a little buffer to protect themselves. It is predicted this may happen if the uncertainty continues, however it is also predicted that (largely) this should only be a flash in the pan as the full impact of the UK’s exit is fully understood and digested.

Please find an article below courtesy of around their thoughts on Brexit and the affect it could have on the New Zealand economy.     

News that the UK has voted for Brexit has shocked commentators and rocked financial markets globally.

Investors and KiwiSavers are being urged not to panic, but what could Brexit mean for New Zealand’s interest rates?

While economists warn it is far too soon to tell what the broader financial impacts might be, most are united in the view that an OCR cut in August is now much more likely.

ASB economist Daniel Snowden said the US Federal Reserve may now pause for thought on its next rate hike and, instead of potentially moving in July, it may wait till later in the year. 

Doing so would keep the NZD elevated against the USD for longer and increase the pressure on the Reserve Bank to cut again in August. 

“This reinforces our view of a 25bp rate cut in August, followed by a final cut to 1.75% in November,” he said.

“Prior to the Brexit vote, we had become less confident of the second cut. 

“However, the global outlook is now marred by uncertainty and we expect to see declines in global commodity prices, further adding to the global deflation impulse.”

The Reserve Bank cut the OCR in March for two main reasons, BNZ senior economist Craig Ebert said.

They were falling inflation expectations and worries about the world economy amid market turmoil at the time.

Ebert said that, to date, currency has not done its job as a monetary buffer to global risk and, for this reason, the Brexit vote must increase the odds of the Reserve Bank easing the OCR further.

“We already forecast two more OCR cuts from the RBNZ – partly premised on global risks.

“Today we up the odds of an August cut to 75%, from 60%, while nudging the odds of a further cut by November up to 60%.”

New Zealand’s relative economic strength should serve it well through the current period of uncertainty.

ANZ chief economist Cameron Bagrie said New Zealand has excellent momentum, which is a big difference from prior to the Asian crisis and GFC when the economy was already losing speed.

“We believe the domestic growth impact will be minor, although it is certainly a moving feast.

“Nevertheless, it does of course increase the odds of an August OCR cut, at a time when we were wavering on whether a further cut was even required.”

However, while the odds are on for further OCR easing in the near future, that may not necessarily translate into lower mortgage rates.

Westpac chief economist Dominick Stephens agreed that Brexit has upped the chances of an August rate cut from the Reserve Bank.

“Markets pricing has moved decidedly in favour of an OCR cut to 2% in August - and a chance of the OCR falling below this.”

But New Zealand is likely to feel the impact of Brexit most immediately through exposure to international financial markets, he said

“To date, the NZ dollar and New Zealand interest rates have fallen, and credit spreads have risen, which will push bank funding costs higher.”

In his view, this means that although two-year swap rates are falling, mortgage rates and business lending rates are unlikely to fall as far or may not fall at all.

Courtesy of


Kind regards

Scott Miller

Advanced Mortgage and Insurance Solutions Ltd
P.O. Box 27243
I Shirley I Christchurch 8640
DDI: +64 3 980 4541
Toll Free: 0508 4663 5626 (0508 HOME LOAN)*
Fax: +64 3 980 4571


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