# HL-Q006: Borrower journey We've got conditional pre-approval for our first home loan and have found a house we like. Does that mean we can make an unconditional offer, or are there more things to check? Borrower: First-home couple with a 10% deposit [Study](https://nzbrands.ai/research/banking/home-lending/) · Collected 11 October 2026 ## chatgpt Answer ID: 86432504-42a9-4642-85dd-694e4301d98a Not necessarily. In New Zealand, **conditional pre-approval does not usually mean you are ready to make an unconditional offer**. It means your lender has assessed you and given an indication of how much they may lend, but they still generally need to approve the **specific property** and complete any remaining lending conditions before your loan is fully confirmed. [Settled.govt.nz](https://www.settled.govt.nz/buying-a-home/making-an-offer/confirming-your-finances/?utm_source=chatgpt.com) Before going unconditional, check these things: 1. **Get your lender to confirm the property is acceptable** - Send the property details and proposed purchase price to your bank or mortgage adviser. - They may require things such as a valuation, a copy of the sale and purchase agreement, or other property information. [Settled.govt.nz](https://www.settled.govt.nz/buying-a-home/making-an-offer/confirming-your-finances/?utm_source=chatgpt.com) 2. **Have your lawyer/conveyancer review the sale and purchase agreement** - An unconditional offer is a legally binding commitment: if accepted, you are generally required to complete the purchase. [Kāinga Ora – Homes and Communities](https://www.kaingaora.govt.nz/en_NZ/home-ownership/guide-to-home-ownership/4-buying/?_searchAnalytics=eyJpbmRleE5hbWUiOiJzZWFyY2gta2Fpbmdhb3ItcHJvZC1tYWluIiwicXVlcnlTdHJpbmciOiJlc3RhdGUgaW4gbGFuZCIsImRvY3VtZW50SWQiOiJzaWx2ZXJzdHJpcGVfY21zX21vZGVsX3NpdGV0cmVlXzIxNzRfZW5fbnoiLCJyZXF1ZXN0SWQiOiIxNjgzZDAwMi04NTk5LTQ4YTQtYjNkMC1mZjgxZDJjMzYyOTcifQ%3D%3D&utm_source=chatgpt.com) - Your lawyer can check the title, easements, covenants, and the agreement terms. [Settled.govt.nz](https://www.settled.govt.nz/buying-a-home/making-an-offer/understanding-the-sale-and-purchase-agreement-when-buying/?utm_source=chatgpt.com) 3. **Complete property due diligence** Consider whether you need: - a building inspection - a LIM report - a valuation (especially if your lender requires one) - checks on renovations, consents, flooding, weathertightness, or other issues relevant to the property. [Settled.govt.nz](https://www.settled.govt.nz/buying-a-home/making-an-offer/understanding-the-sale-and-purchase-agreement-when-buying/?utm_source=chatgpt.com) 4. **Confirm insurance** - Your lender will usually want evidence that the property can be insured before settlement. [Settled.govt.nz](https://www.settled.govt.nz/buying-a-home/making-an-offer/confirming-your-finances/?utm_source=chatgpt.com) 5. **Check your cash position** - Make sure you have the deposit available and understand when it becomes payable under the agreement. - Also allow for legal fees, valuation/inspection costs, moving costs, and any immediate repairs or maintenance. A common approach is to make an offer **conditional on finance and any key checks**, then go unconditional once those conditions are satisfied. This is often safer than going unconditional based only on pre-approval. [Settled.govt.nz](https://www.settled.govt.nz/buying-a-home/making-an-offer/buying-by-deadline/?utm_source=chatgpt.com) If the seller is pushing for an unconditional offer (for example, in a competitive situation), it is worth speaking with your lawyer and lender **before signing anything** rather than relying on the pre-approval alone. [Kāinga Ora – Homes and Communities](https://www.kaingaora.govt.nz/en_NZ/home-ownership/guide-to-home-ownership/4-buying/?_searchAnalytics=eyJpbmRleE5hbWUiOiJzZWFyY2gta2Fpbmdhb3ItcHJvZC1tYWluIiwicXVlcnlTdHJpbmciOiJlc3RhdGUgaW4gbGFuZCIsImRvY3VtZW50SWQiOiJzaWx2ZXJzdHJpcGVfY21zX21vZGVsX3NpdGV0cmVlXzIxNzRfZW5fbnoiLCJyZXF1ZXN0SWQiOiIxNjgzZDAwMi04NTk5LTQ4YTQtYjNkMC1mZjgxZDJjMzYyOTcifQ%3D%3D&utm_source=chatgpt.com) --- ## gemini Answer ID: 6b58ba5e-3c44-44ba-b2d5-b4bf07104cbb Having a conditional pre-approval is a massive milestone—it means the bank has looked at your income, expenses, and deposit and agreed in principle to lend you up to a certain amount. However, **no, it does not mean you should make an unconditional offer.** In New Zealand property law, an unconditional offer is a legally binding commitment. There is **no cooling-off period** once an offer goes unconditional. If you make an unconditional offer and something goes wrong with the house or your final loan approval falls through, you could lose your deposit (typically 10%) or face legal action. Pre-approval only approves *you* as a borrower; it does not yet approve the *house*. Before you can safely buy, you still have several critical checks and steps to complete. --- ### Key Things to Check Before Going Unconditional You should make your offer **conditional** on a set of due diligence clauses (typically giving you 10 to 15 working days). This protects your deposit while you check the following: * **Property-Specific Finance Approval:** Send the signed Sale and Purchase Agreement to your bank or mortgage broker immediately. The bank needs to review the specific property to ensure it meets their lending criteria (e.g., checking the title, checking if a registered valuation is required, and ensuring the property value stacks up against your purchase price). * **A Builder’s Report:** Hire an independent, qualified building inspector to check the structural integrity and weather-tightness of the house. Never skip this, even if a home looks immaculate. * **A LIM Report (Land Information Memorandum):** Order this official report from the local council. It will show you council records regarding building consents (ensuring all decks, additions, or plumbing were legally permitted), rates, zoning, and potential hazards like flooding or erosion. * **The Record of Title:** Have your lawyer or conveyancer check the title for any easements, covenants, or cross-lease restrictions that might dictate what you can and cannot do with the property. * **House Insurance:** Banks in New Zealand require you to have full replacement house insurance in place before they will release the funds for settlement. Ensure you can actually get insured for the property and note any requirements (like natural disaster or earthquake cover). ### Crucial Exception: Auctions If the house you like is being sold via **auction**, the rules are completely different. Auctions in New Zealand are **unconditional by default**. If you bid and the hammer falls, you are legally locked in on the spot. If you want to buy an auction property with pre-approval, you must complete all your checks (builder's report, LIM, lawyer review, and bank property sign-off) *before* the auction day, and arrange with the vendor to pre-bid unconditionally or bid conditionally with their written agreement. ### Your Next Step Before signing anything, **hand the Sale and Purchase Agreement over to your lawyer or conveyancer to review**, and touch base with your bank or mortgage adviser to let them know you’ve found a house. Are you looking to buy through a standard private treaty/deadline sale (where you can add conditions), or is the property going to auction? --- ## ai-mode Answer ID: 5531c70c-b273-411b-9a4d-1604a8127684 Making an **unconditional offer** right now is generally **not recommended** , even with conditional pre-approval. Conditional pre-approval means your bank or lender has agreed in principle to lend you money based on an initial look at your finances, but it is **not a final guarantee**. Before making an offer unconditional (or making an offer without specific conditions protecting you), there are several critical checks, due diligence tasks, and formal approvals you still need to complete. What Conditional Pre-Approval Doesn't Cover * * **The specific property:** The lender hasn't assessed the house itself yet. They need to approve the specific property to ensure it meets their lending criteria (e.g., location, type of construction, market value via a valuation or property report). * **Final financial verification:** Your financial situation must remain unchanged. Any shift in your income, spending, or new debt (like buying a car or a new credit card) between pre-approval and settlement can cause the lender to pull their support. * Key Things to Check and Do Before Going Unconditional * * Property Valuation: Your lender may require a registered valuation or a property report to ensure the purchase price aligns with market value. If the bank values the house for less than your offer, they may reduce how much they are willing to lend, leaving you to cover the shortfall in cash. * Building Inspection: Arrange for a qualified professional to check the structural integrity, weather-tightness, and overall condition of the home to avoid hidden, expensive repair bills. * LIM Report (Land Information Memorandum): Order a LIM from the local council. It contains crucial property data including consent history, zoning, drainage, and any outstanding council notices or hazards. * Title Search: Review the Record of Title with your solicitor or conveyancer to check for interests registered against the property, such as easements, covenants, or cross-lease restrictions that could limit what you can do with the land. * Solicitor Review: Have your legal representative review all the contract and purchase documents before you sign anything or confirm conditions. * Final Bank Sign-Off: Once you have signed a Sale and Purchase Agreement (usually initially subject to conditions), your broker or bank must formally reassess the specific property and grant **unconditional finance approval**. * How to Protect Yourself When you submit an **Agreement for Sale and Purchase** , you should include **conditions** (such as "subject to finance," "subject to a satisfactory building inspection," and "subject to LIM approval"). This gives you a specific window (usually 5 to 10 working days) to complete these checks. Only when your solicitor and lender confirm everything is clear do you uplift those conditions, making the agreement **unconditional**. If you'd like, let me know: * Have you already signed a **Sale and Purchase Agreement**? * Do you currently have a **solicitor or conveyancer** lined up? I can help you understand the **next steps** in the conditional offer timeline. --- ## ai-overviews Answer ID: 45222397-2a94-4b24-8ead-522210eac9a9 **No, you should not make an unconditional offer yet.** Conditional pre-approval only means the bank is willing to lend to _you_ based on your personal finances—it does not mean they have approved the specific _house_ you want to buy. If you make an unconditional offer and the bank later refuses to finance that specific property, you will still be legally obligated to buy it. Failing to settle can result in losing your deposit and being sued for damages. * * * Why Pre-Approval Isn't Enought: The Hidden Risks Banks evaluate both the borrower and the property. Even with great credit, a lender may reject a house due to underlying issues: * **Property Type Restrictions:** Apartments, cross-leases, monolithic cladding (plaster homes prone to leaking), or lifestyle blocks often have much stricter lending criteria. * **Low Equity Margins:** If you have less than a **20% deposit** , banks are highly selective and will manually vet the property before giving final approval. * **Uninsurable Risks:** If you cannot secure standard house insurance (e.g., due to flood zones or earthquake risks), the bank will not advance the loan. * * * 4 Things You Must Check Before Going Unconditional Before you commit, you must switch your "conditional pre-approval" into **unconditional finance approval** for this exact address. Work with your solicitor or mortgage adviser to clear these checks: 1\. Bank Approval of the Property * Send the draft **Sale and Purchase Agreement** and the property listing to your lender or broker immediately. * The bank may require a registered valuation to ensure the house is worth what you are paying. 2\. Title and LIM Report (Land Information Memorandum) * Have your lawyer review the **Record of Title** to check for easements, land covenants, or boundary issues. * Order a **LIM report** from the local council to check for historical flooding, protected trees, and unconsented building works. 3\. Building Report * Hire a qualified building inspector. * Look for structural issues, moisture levels, deferred maintenance, or signs of methamphetamine contamination. 4\. Insurance Sign-off * Get a concrete quote for building insurance. * The bank requires insurance to be active from the day the agreement becomes unconditional. * * * Recommended Strategy: Make a Conditional Offer Instead of bidding unconditionally, have your lawyer draft a **conditional offer**. This protects your deposit while giving you time to complete your checks. Standard conditions to include are: * **Finance:** (Even with pre-approval, this gives your bank time to vet the specific property) * **LIM Report:** (Typically 10 working days) * **Building Report:** (Typically 5 to 10 working days) Conditional offers explained: what NZ sellers need to know If you are buying via **Auction** , you cannot add conditions. You must complete every single one of the checks above _before_ auction day so you can confidently bid unconditionally. * * * To help steer your next steps, let me know: * Are you looking to buy via **auction, negotiation, or tender**? * Do you have a **deposit of 20% or more** , or are you using **KiwiSaver/First Home Grant**?