Kit Jackson has been providing mortgage and insurance advice to Wellington property owners for over 10 years. Here he shares what he’s seeing in the current market and some insights into the lending process.
How long have you been providing a mortgage and insurance broking service in Wellington?
I began in the industry in 2003, so for over 13 years we’ve been providing advice in Wellington and to those further afield.
What are the main benefits of using a mortgage broker?
That varies from client to client depending on what they are trying to do! For investors, the main benefits are being able to go to the right lender to max out their borrowing ability with the least amount of fuss and at the best rates possible to maximise their returns.
Once we’ve started on an investment journey with a client, yes there’s a need to update their personal information along the way but there’s no need to keep explaining their stories to us, I do that on their behalf to the banks. Personal or business bank managers will come and go regularly, but after 13 years in the business, I remain the constant for all my clients. I find that people see great value in that and it allows them to concentrate on the business of finding properties. Add to all this the fact that my service is free (the banks pay me a commission) and that I’ll get as good if not a better deal than people would get going directly to a bank it makes a win-win for the client!
With interest rates currently low, are there occasions when you can bring savings to a client through moving to a different loan type or provider?
Yes it has been a pretty common occurrence over the past couple of years. People are breaking out of their higher fixed rates, and then re-financing with another provider on lower rates. With good cash contributions usually the cost of the conveyancing and some or all of the break fee itself are covered. I have been advised by accountants that the break fee is a claimable expense for investors (check with your own accountant!), so there are plenty of good reasons for considering it.
How many lenders would you typically have access to?
I have access to all the major lenders except for HSBC who have no real presence in NZ and also Kiwibank. BNZ recently came back into the market with some mortgage brokers and offered some interesting benefits so it’s good to have them back in the mix. Typically I stick to the mainstream banks unless there’s a need or reason to look at second tier lenders. I have strong relationships with the banks as a whole, and with the varying parts of the bank from retail to business to commercial.
Do investors form a large percentage of your lending work?
Absolutely! I deal with occasional or accidental investors and also with serial investors! It’s fantastic to see a lot of Wellington investors who have been very patient over the last few years, suddenly have access to more equity as their property values have finally risen, and are therefore able to “go again”.
Do you work with investors who have a property and want to add a room or other renovation to increase the rent?
Very much so. Whether it’s releasing equity first to then do the work, or construction lending by applying for additional lending based on the anticipated increase in value. This part of the job is when the banks can be at their most painful, so it’s always best to have an adviser in the middle to ensure it goes as smoothly as possible.
What’s the best fixed term to go for at the moment?
That depends! There’s no one size fits all, so come in and have a chat and we can go through what’s best for you!