# HL-Q001: Borrower journey My partner and I want to buy our first home. We both have salaried jobs and about a 10% deposit. Are we ready to start talking to banks, or should we keep saving? Borrower: First-home couple with a 10% deposit [Study](https://nzbrands.ai/research/banking/home-lending/) · Collected 11 October 2026 ## chatgpt Answer ID: 910a9f1d-ecd3-4b8a-b698-be7cdae180ad My advice: start talking to banks now, while continuing to save. You don't necessarily need to wait until you've saved a 20% deposit before exploring your options. As a first-home-buying couple in New Zealand, with two salaried incomes and around a 10% deposit, you're in a reasonable position to start finding out what you can afford. Whether you're ready to buy will depend on your combined income, existing debts, regular expenses, the size of your deposit and the property you're considering. The goal at this stage isn't necessarily to get a mortgage immediately. It's to understand what a bank might lend you, what your repayments would look like, and whether waiting longer would put you in a stronger position. ## 1. Why a 10% deposit can be enough to start In New Zealand, many banks prefer a 20% deposit, but they can lend to some owner-occupiers with smaller deposits. There are limits on how much low-deposit lending banks can do, so approval isn't guaranteed. [Loan-to-value ratio restrictions - Reserve Bank of New Zealand](https://www.rbnz.govt.nz/Regulation%20and%20supervision/Oversight%20of%20banks/Standards%20and%20requirements%20for%20banks/Macroprudential%20policy/Loan-to-value%20ratio%20restrictions)[Reserve Bank to ease LVR restrictions - Reserve Bank of New Zealand](https://www.rbnz.govt.nz/news-and-events/news/2025/10/reserve-bank-to-ease-lvr-restrictions) Here are the main options worth exploring: - Buy with a 10% deposit: Ask banks whether they have low-deposit lending available for your circumstances. - Check whether you're eligible for a First Home Loan: This Kāinga Ora-supported scheme can allow eligible buyers to purchase with a 5% deposit. Income and other eligibility criteria apply. [First Home Loan - Ministry for Cities, Environment, Regions and Transport (Formerly Te Tūāpapa Kura Kāinga](https://www.hud.govt.nz/funding-and-support/first-home-loan)[First Home Decision Tool :: Kāinga Ora](https://kaingaora.govt.nz/en_NZ/home-ownership/first-home-decision-tool/?_searchAnalytics=eyJpbmRleE5hbWUiOiJzZWFyY2gta2Fpbmdhb3ItcHJvZC1tYWluIiwicXVlcnlTdHJpbmciOiJraXdpc2F2ZXIgd2l0aGRyYXdhbCIsImRvY3VtZW50SWQiOiJzaWx2ZXJzdHJpcGVfY21zX21vZGVsX3NpdGV0cmVlXzk0M19lbl9ueiIsInJlcXVlc3RJZCI6ImNkYmJhODc0LTAxNTctNGVjOC1hMjNmLWViMTdiMWZhODUzMyJ9) - Use KiwiSaver: If eligible, you may be able to withdraw your KiwiSaver savings for your first home, provided at least $1,000 remains in your account. [KiwiSaver first-home withdrawal :: Kāinga Ora](https://www.kaingaora.govt.nz/en_NZ/home-ownership/kiwisaver-first-home-withdrawal/) ## 2. What the bank will actually look at Having two salaried incomes is helpful, but lenders will assess your overall financial position. | What they'll assess | What you should aim for | | --- | --- | | Combined income | Stable, documented income from both jobs | | Existing debt | Keep credit-card limits, personal loans and car loans manageable | | Spending | Show that you can comfortably cover expenses and save regularly | | Deposit | Have evidence of your savings and any eligible KiwiSaver withdrawals | | Repayments | Be comfortable with repayments even if interest rates rise | | Cash buffer | Retain money for legal fees, inspections, moving and unexpected repairs | Banks also operate under debt-to-income restrictions, which can limit lending when borrowing is high relative to gross household income. [Understanding debt-to-income (DTI) restrictions - Reserve Bank of New Zealand](https://www.rbnz.govt.nz/education/explainers/dti-) One important point: Don't assume that the maximum amount a bank is willing to lend is the amount you should borrow. ## 3. Should you save to 20% first? I'd weigh it up like this. Talk to banks now Find out your potential borrowing limit, whether they'll consider a 10% deposit, what interest rates and low-equity costs may apply, and whether you qualify for any first-home assistance. Keep saving in parallel A larger deposit reduces the amount you need to borrow and may give you access to better lending terms. It also helps preserve a cash buffer after settlement. Buy when the numbers work You don't need to wait for 20% if a suitable loan is available and the repayments are genuinely affordable for you both. You can start with a mortgage adviser or a bank's home-loan team. A conditional pre-approval can help establish a realistic price range, although the lender will still need to approve the specific property and confirm the loan before settlement. [Confirming your finances](https://www.settled.govt.nz/buying-a-home/making-an-offer/confirming-your-finances/) ## 4. Let's work out whether you're close If you share a few approximate numbers, I can help you estimate whether buying now looks realistic or whether another 6–12 months of saving could put you in a much stronger position. Approximate figures are fine. Use NZ dollars and annual income before tax. With those figures, we can look at the trade-off between buying sooner with a 10% deposit and waiting to build a bigger deposit, rather than assuming that one option is automatically better. --- ## gemini Answer ID: f12f853a-62b3-4bc7-9757-3751fa3ff955 You are definitely at the stage where you should **start talking to banks or a mortgage broker**, rather than waiting to save more. Having a **10% deposit** combined with **salaried jobs** puts you in a viable position under current New Zealand lending rules. You don't necessarily need to wait until you hit 20%. --- ### Why a 10% Deposit is Viable Right Now 1. **Low-Deposit Lending Allocations ("Speed Limits"):** The Reserve Bank of New Zealand (RBNZ) permits retail banks to allocate a portion of their total new owner-occupier lending to borrowers with a deposit of less than 20% (an LVR above 80%). While competition for these spots can vary, a significant share of this low-deposit lending goes directly to first-home buyers. 2. **Kāinga Ora First Home Loan Option:** If your combined household income is under **$150,000 (gross)**, you might qualify for a Kāinga Ora First Home Loan, which only requires a **5% deposit** and is exempt from standard Reserve Bank LVR and DTI restrictions. 3. **The Reality of Saving vs. House Price Growth:** Trying to out-save a rising property market purely through a savings account can sometimes feel like chasing a moving target. Getting pre-approval helps you understand your actual boundaries. --- ### What to Expect When You Talk to a Bank or Broker Be prepared for the banks to look far deeper than just your deposit size. Under current regulations, they evaluate your application using strict criteria: * **Debt-to-Income (DTI) Caps:** For owner-occupiers, banks generally cap total borrowing at **6 times your gross annual household income** (though exceptions apply for a limited portion of their lending). * **Serviceability Stress Tests:** Banks don't test whether you can afford your mortgage at today's interest rates. They apply a stressed test rate (often around 8.5% to 9%) to ensure you can comfortably handle future economic shifts. * **The 3-Month Rule (CCCFA):** Banks will comb through your last 3 to 6 months of transaction statements. They look closely at spending habits, uncommitted monthly income buffers, and existing debt (including credit card limits, even if unused, and car loans). * **Low Equity Margins (LEM):** Because your deposit is under 20%, the bank will likely apply a temporary "low equity margin" (a slightly higher interest rate or a one-off fee) to your loan until you pay the principal down or the property value increases to an 80% LVR. --- ### Recommended Action Plan 1. **Pull Together Your Numbers:** Gather your recent payslips, KiwiSaver balances, proof of your 10% savings, and a breakdown of your regular monthly expenses. 2. **Check Your Credit Scores:** Ensure there are no defaults or hidden surprises on your credit report via agencies like Centrix, Equifax, or Illion. 3. **Consult a Mortgage Broker (Free Service):** Reach out to a registered adviser. Unlike going to a single bank, a broker can look across multiple lenders to see which bank has an appetite for 10% deposit lending and matches your income profile best. Are you working with a mortgage broker yet, or would you like a breakdown of how to check your KiwiSaver and First Home Withdrawal eligibility? --- ## ai-mode Answer ID: e7d84928-4c78-4a1e-9177-b78d0ece44ce **You are ready to start talking to banks or a mortgage adviser right now.** Having stable salaried jobs and a **10% deposit** puts you in a viable position to explore your borrowing capacity, even though standard Reserve Bank rules mean most home loans require a **20% deposit**. New Zealand banks operate under a "speed limit" system (Loan-to-Value Ratio, or LVR restrictions) that allows them to allocate a portion of their lending—typically up to 25% for owner-occupiers—to buyers with less than a 20% deposit. Because you have steady salaried incomes and a 10% pool, you may well fit into a bank’s low-deposit quota, or you could look into a brand-new build or a [Kāinga Ora First Home Loan](https://www.govt.nz/browse/housing-and-property/buying-or-selling-a-home/buying-your-first-home/) which can accept a 5% deposit if you meet income caps. [Opes Partners] Why You Should Talk to a Bank or Broker Now * * **Determine Borrowing Power:** Find out exactly how much a bank is willing to lend you based on your combined salaries and current Debt-to-Income (DTI) caps (which generally limit owner-occupiers to 6 times their income). [Opes Partners] * **Understand Low-Equity Costs:** A 10% deposit instead of 20% means you will likely pay a **low-equity margin (LEM)** —a temporary higher interest rate or fee added to your loan until your equity reaches 20%. * **Map Out a Timeline:** A professional can tell you if continuing to save makes a tangible difference or if you can enter the market sooner than expected. * Key Next Steps * * **Gather Documents:** Prepare your last 3 to 6 months of bank statements, payslips, and proof of your KiwiSaver balances. * **Compare Options:** Consider speaking with a free mortgage broker who can shop around multiple major New Zealand lenders on your behalf, or approach your main bank directly. * **Factor in Extra Costs:** Remember to budget for upfront non-recoverable expenses like legal fees (solicitors), building inspections, and LIM reports. * If you'd like, let me know: * Your **approximate combined household income** * Your **target house price range** in your preferred region I can help you estimate what your weekly mortgage repayments might look like with a 10% deposit. --- ## ai-overviews Answer ID: ddcb02eb-b456-4fbf-876e-f018343f6169 **Yes, you are ready to start talking to banks and mortgage brokers right now.** While a **20% deposit** is the standard benchmark in New Zealand to avoid extra costs, most major Kiwi banks actively lend to first-home buyers with a **10% deposit** , provided you have stable salaried incomes to service the mortgage. Talking to a professional early will give you a clear picture of your borrowing capacity and help you map out your next steps. Here is a breakdown of what a 10% deposit means for you in the current New Zealand market and why you should make the call. Why You Should Start the Conversation Now * **Get a Realistic Budget:** Banks don't just look at your deposit; they test your ability to service a loan at a higher "test interest rate." Speaking with a bank or a mortgage broker will tell you exactly what price range you can look at. * **Identify Financial Blind Spots:** They will review your bank statements and help you clean up your account conduct (e.g., reducing credit card limits, eliminating Buy Now Pay Later habits) so you look as low-risk as possible when you formally apply. * **Understand Your "Low-Deposit" Costs:** Lending with less than a 20% deposit is called low-equity lending. Banks charge extra for this, and knowing these costs ahead of time will help you budget: * **Low Equity Premium (LEP):** A one-off upfront fee (often 0.25% to 2% of the total loan amount) that is usually added to your mortgage balance. * **Low Equity Margin (LEM):** An additional interest rate percentage (typically 0.25% to 1.5%) added to your standard fixed or floating interest rate until your equity reaches 20%. Government Help for 10% Deposits When you speak to a lender, ask them if you qualify for government-backed products administered by **Kāinga Ora** (the government housing agency), which are specifically designed for lower deposit amounts: * **First Home Loan:** Under this scheme, selected banks can provide loans with as little as a **5% deposit**. Because Kāinga Ora underwrites the loan, you can often bypass the expensive low-equity margins that banks usually charge. * **KiwiSaver First-Home Withdrawal:** If you and your partner have been contributing to KiwiSaver for at least three years, you can likely withdraw your savings (leaving a $1,000 minimum balance) to count toward your 10% deposit. What to Prepare Before Talking to a Lender To make your initial consultation as productive as possible, gather the following details: 1. **Proof of Income:** Your latest 3 months of payslips to verify your salaried roles. 2. **ID & KiwiSaver Statements:** Up-to-date balances showing how much you can withdraw. 3. **Debt & Expenses:** A clear list of any student loans, car loans, credit cards, or overdrafts. Next Steps You don't need to commit to a specific property to get started. You can book an initial chat directly with home loan officers at major banks like [ANZ](https://www.anz.co.nz), [ASB](https://www.asb.co.nz), [Westpac](https://www.westpac.co.nz), or [BNZ](https://www.bnz.co.nz). Alternatively, consider using a registered **mortgage broker** , who can compare policies across multiple banks simultaneously to find the most lenient low-deposit terms for your specific salaried situation.