Kick Start Home Loan - for first home buyers trying to save for a deposit

The Kick Start Home Loan from Savings & Loans is designed to help you get into your first home faster by providing top-up finance to reach 100% of your purchase price. If you're finding it hard to save for a deposit, this will give you the kick start you need to enter the property market.

A Kick Start Home Loan:

• allows you to borrow up to $75,000 to meet the financial requirements for your purchase.


• enables you to buy your first home with a smaller cash deposit than most lenders are currently seeking.


• offers flexible repayment options to suit your circumstances, with no interest penalties if you repay your loan early.


• can often be approved within one day.

What is a Kick Start Home Loan?
A Kick Start Home Loan is a combination loan using a first mortgage of 80% and a second mortgage of up to 15%, providing home loan finance up to 95%.

It is a home loan designed for buyers who have only a 5-10% deposit, in a market where most banks and lenders are currently requiring 20%. By enabling buyers to bump up their deposit to 20%, it is also a way to avoid paying hefty Lenders Mortgage Insurance (LMI) fees that are often charged by home loan providers on loans over 80%.

How does the first mortgage work?
The first mortgage of 80% is provided by a mainstream home loan lender at normal bank interest rates. The term of the loan can be up to 30 years, with various repayment options available. A full range of floating and fixed rate options are also available.

Savings & Loans can help you with the application and processing of this first mortgage to make purchasing your first home even easier. We will put you in touch with our representative who will work with a range of lenders so we can help you find the right package (interest rates and repayment options) that works best for you.

How does the second mortgage work?
The second mortgage of up to 15% is provided by Savings & Loans Limited. The repayments are based on a 10 year term with the current rate of 15.75%. These rates are subject to change at the discretion of Savings & Loans. The loan has an establishment fee of $1200 which can be added to the loan.

What type of deposit is acceptable?
Your 5-10% deposit must be from genuine savings or from the sale of an asset. Gifted deposits, family loans or vendor finance are not acceptable for the Kick Start Home Loan (however, you may still qualify for other types of home loans, so email us today or phone us on 0800 728 464 (0800 SAVINGS) to discuss your needs.

What type of properties qualify?
Owner occupied residential homes on land up to 2.2 ha (5 acres) in the Auckland, Hamilton, Tauranga, Wellington, Christchurch and Dunedin regions (call us on 0800 728 464 to discuss other areas). A suitable registered valuation will be required in all cases demonstrating that the property is readily saleable with no adverse features. Private sales do not qualify.

What are the likely loan repayments?
Kick Start Home Loans are available for up to $75,000 over a term of 10 years. Loan repayments are to be principal and interest.

The summary below will give you an idea of how the Kick Start Home Loan can help you reach your purchase price, and what the repayment amounts might be. These figures are indicative only and interest rates are subject to change.

The first mortgage is based on a 6.50% fixed rate and interest-only repayments. The second mortgage is based on 15.75% and principal and interest repayments over 10 years. The second mortgage loan amount includes a $1200 establishment fee.

What are the penalties for early repayment?
There are no interest penalties for early repayment of the second mortgage loan. You may, therefore, be able to revalue the property over time and top-up the first mortgage to repay the second mortgage.

A mortgage discharge fee of $150 and an account closing fee of $100 will apply when the second mortgage is repaid in full.

If you wish to make an early repayment to the first mortgage, a break fee may apply if your loan is on a fixed rate.

What about mortgage repayment insurance?
As a condition of the Kick Start Home Loan you will be required to have mortgage repayment insurance (also known as mortgage protection insurance) on at least the second mortgage portion of the loan. This will cover the second mortgage repayments in the event of death, bankruptcy or redundancy. We recommend you also take out life and income protection insurance to cover the first mortgage (you will be provided with a quote for insurance with your loan approval).

What information do you require?

• a completed application form - call us on 0800 728 464 (0800 SAVINGS) to receive a copy by fax or email


• confirmation of your cash deposit (e.g. savings account bank statements from the last 6 months)


• confirmation of your income (e.g. a copy of your last two pay slips or a letter from your employer)


• bank statements from your main bank account (where your income is deposited) from the last 3 months


• photo ID - a photocopy of your driver's licence or passport


• the Sale and Purchase Agreement of the property being purchased


• a Registered Valuation of the property being purchased

Who can apply for a Kick Start Home Loan?
A Kick Start Home Loan is for the purchase (genuine arm's length transactions only) of a first home.

Borrowers must:

• be the same as the mortgagors


• be New Zealand citizens or permanent residents


• have a clean credit record


• have less than $10,000 of other short-term debt


• satisfy all other Savings & Loans lending criteria - contact us to discuss

Is pre-approval available on a Kick Start Home Loan?
Yes, we recommend you get pre-approved before looking at properties so you know how much you can borrow. We do not require a Sale and Purchase Agreement or a Registered Valuation for the initial pre-approval, but these will be required when you purchase a property. We recommend, therefore, that you make the Sale and Purchase Agreement conditional upon finance until you get final approval.

Is the Savings & Loans Kick Start Home Loan right for you?
Email us today to request more information or phone us on 0800 728 464 (0800 SAVINGS) to discuss your needs.

We can arrange for a representative to meet with you to help you complete the first and second mortgage applications and discuss any other financial needs you may have.