# HL-Q011: Choosing a loan I'm buying my first home and work on contracts rather than a salary. I've got three years of earnings records and about a 20% deposit. Which lenders would you suggest I approach? Borrower: Solo contractor buying a first home [Study](https://nzbrands.ai/research/banking/home-lending/) · Collected 11 October 2026 ## chatgpt Answer ID: f68710b4-07ea-44b4-808a-d8e1ec2f06e9 With three years of earnings records and a 20% deposit, you’re in a reasonable position to start approaching mortgage lenders in New Zealand. I’d start with the major banks, while also speaking to a mortgage adviser who specialises in contractors and self-employed borrowers. The key distinction is whether you're an independent contractor with a consistent history of contract income, or whether you operate through your own company and draw income from it. Lenders may assess those situations differently, even when your actual earnings are similar. ## Which lenders I'd approach first 1. ANZ — first on my list Worth approaching if your contract history shows consistent income and you can document it clearly. ANZ accepts accountant-prepared financial statements for self-employed applicants and assesses the full financial picture. [How to apply for a Home Loan](https://www.anz.co.nz/personal/home-loans-mortgages/how-to-apply/)[How to get home loan pre-approval](https://www.anz.co.nz/personal/home-loans-mortgages/buying/pre-approval//) Start here: [ANZ home loan application](https://www.anz.co.nz/personal/home-loans-mortgages/how-to-apply/) 2. ASB — strong first-home option ASB is worth comparing, particularly if your income is well documented and you have stable work history. It asks self-employed applicants for up-to-date accountant-prepared financial statements. [Thinking about buying your first home| ASB Home Loan](https://www.asb.co.nz/home-loans-mortgages/buying-first-home/starting.html)[Home loan application tips](https://www.asb.co.nz/home-loans-mortgages/home-loan-application-checklist-guide.html) Start here: [ASB first-home buying guide](https://www.asb.co.nz/home-loans-mortgages/buying-first-home/starting.html) 3. BNZ — worth a comparison application BNZ accepts business financial statements for self-employed applicants and examines expenses, existing debt and income. Ask specifically how it would assess contract income rather than a conventional salary. [Preparing for a home loan appointment](https://www.bnz.co.nz/support/home-loans/buying-a-home/preparing-for-a-home-loan-appointment)[Understanding debt to income ratios](https://www.bnz.co.nz/support/home-loans/buying-a-home/understanding-debt-to-income-ratios) Start here: [BNZ mortgage preparation guide](https://www.bnz.co.nz/support/home-loans/buying-a-home/preparing-for-a-home-loan-appointment) 4. Westpac — another mainstream option Westpac requests accountant-prepared financial statements for self-employed applicants. It's worth asking whether your contract history and supporting records meet its income-verification requirements. [How to apply for a home loan](https://www.westpac.co.nz/home-loans-mortgages/how-to-apply-for-a-home-loan/) Start here: [Westpac home loan application guide](https://www.westpac.co.nz/home-loans-mortgages/how-to-apply-for-a-home-loan/) 5. Kiwibank — include in your shortlist Kiwibank also accepts accountant-prepared financial statements for self-employed applicants. I'd compare its assessment of your income and overall borrowing capacity with the other banks. [Apply | Home loans](https://www.kiwibank.co.nz/personal-banking/home-loans/apply/) Start here: [Kiwibank home loan application](https://www.kiwibank.co.nz/personal-banking/home-loans/apply/) 6. Pepper Money — specialist backup If the banks struggle to fit your contract income into their standard assessment, Pepper offers alternative-documentation (alt-doc) loans. It advertises options using business bank statements and other business records, subject to assessment. Its rates and fees can be higher than mainstream bank lending, so I'd treat it as a fallback rather than my first choice. [Self-Employed & Alt Doc Home Loans](https://www.peppermoney.co.nz/home-loans/self-employed-alt-doc)[Real-Life Guide: Home Loans for the Self-Employed](https://www.peppermoney.co.nz/resources/self-employed-home-loans) Start here: [Pepper Money self-employed home loans](https://www.peppermoney.co.nz/home-loans/self-employed-alt-doc) ## Why your three years of records matter The strongest application will demonstrate that your income is sustainable, not just that you have earned a good amount over three years. - If you're a contractor paid directly by clients or agencies: provide signed contracts, renewal history, invoices and matching bank deposits, plus IRD income records. - If you operate through a limited company: provide company accounts, tax returns and evidence of what you pay yourself. - If your earnings fluctuate: prepare a year-by-year income summary and explain any gaps, unusually high earnings or changes in your contract rates. A lender may assess your income using an average, recent financial statements, or a more conservative figure. Three years of records help, but don't guarantee approval. ## What I'd do next 1. Speak with a mortgage adviser who regularly handles contractor and self-employed applications. Ask them to compare the five major banks before submitting applications. 2. Get your accountant to prepare or organise your latest financial statements and tax records. 3. Request a conditional pre-approval and ask how much of your documented income the lender will actually use. 4. Keep some of your savings available for legal fees, inspections and other buying costs rather than allocating every dollar to the deposit. One further point: a 20% deposit is a good starting position, but lenders also assess affordability and debt-to-income limits. For owner-occupier lending in New Zealand, debt above six times gross annual income is subject to tighter bank restrictions, with some lending permitted above that threshold. [Debt-to-income ratio | Home loans](https://www.kiwibank.co.nz/personal-banking/home-loans/guides/debt-to-income-ratios/)[Understanding debt to income ratios](https://www.bnz.co.nz/support/home-loans/buying-a-home/understanding-debt-to-income-ratios) ## One question that would help me narrow this down How are you paid for your contract work? --- ## gemini Answer ID: 27f7bd2e-03ef-46ea-bffc-652a6170d6b0 Buying your first home on contract earnings with **three solid years of financial records** and a **20% deposit** puts you in a much stronger position than you might think. While many lenders prefer the predictability of a standard PAYE salary, having a 3-year track record completely satisfies mainstream bank policy, which typically requires a minimum of 2 years of accountant-prepared accounts for contractors or self-employed applicants. Furthermore, hitting that 20% deposit threshold means you bypass the Reserve Bank’s tight high-LVR speed limits, giving you access to standard prime interest rates and a wider pool of lenders. --- ### Mainstream Lenders to Approach Because you have 3 years of records and a healthy deposit, you can look directly at New Zealand's major retail banks. However, each bank treats contract income slightly differently, particularly if your earnings fluctuate between contracts: 1. **ANZ:** Often considered one of the more pragmatic main banks for contractors and self-employed borrowers, provided you can demonstrate continuity of work in the same industry. They look closely at your net profit and how consistent your pipeline has been. 2. **ASB:** Generally accommodating to contractors who operate through a company or as a sole trader, provided tax returns (IR3) and GST filings are up to date and neatly aligned with your accountant's financial statements. 3. **BNZ & Westpac:** Both are solid tier-one options. They will typically average your net taxable income over the last two years (or look at the trajectory if income has grown), factoring in business vs. personal expenses. --- ### How Banks Will Assess Your Contractor Income Understanding how a bank's credit team calculates your borrowing power will help you prepare your application: * **The Taxable Income Hurdle:** Banks assess serviceability based on what you **declare to the IRD**. If your accountant has aggressively minimized your taxable income through write-offs and deductions, the bank will use that lower net figure, which can restrict how much they are willing to lend. * **Income Averaging vs. Trend:** If your income has grown year-on-year over your 3-year history, many lenders will take a blended average or lean more heavily toward the most recent, stable financial year. If your income dropped recently, they will usually base their calculations on the lower year as a conservative measure. * **Contract Continuity:** Underwriters want to see that your contracting work is sustainable. Having a history of rolling contracts, repeat clients, or working within the same specialized sector for all three years works heavily in your favor. --- ### Key Documents to Prepare Before You Approach a Bank To make your application seamless, have your documentation organized before walking into a branch or engaging a broker: * **Financial Statements:** The last 2 to 3 years of accountant-prepared Profit & Loss statements and Balance Sheets. * **Tax Records:** Corresponding IRD Summary of Income / IR3 tax returns and Notice of Assessments. * **Business & Personal Bank Statements:** Usually 3 to 6 months of complete statements showing clean financial conduct (no unarranged overdrafts, heavy gambling transactions, or unpaid debts). * **Current Contracts:** Copies of active client contracts, Master Services Agreements (MSAs), or letters of engagement proving ongoing or future workflow. > **Tip:** Given that contractor applications require a bit more navigation around write-offs, add-backs, and company structures, utilizing a **free independent mortgage broker** can save you considerable friction. Brokers know precisely which lender's credit policy is most favorable for specific contracting industries at any given time. --- --- ## ai-mode Answer ID: b21f1ca8-e958-4771-a5ef-fee8e1e9696b With **three years of contracting history** and a **20% deposit** , you are in a much stronger position than someone just starting out on a non-standard income. Most major New Zealand lenders look for a minimum of two years of stable self-employed or contracting history, meaning your three-year track record clears the primary hurdle for traditional mainstream policies. Major Mainstream Banks (Tier 1) Because your documentation is well-established and you meet the standard 20% LVR (Loan-to-Value Ratio) deposit threshold, the major high street banks are fully accessible to you: * * **ANZ, ASB, BNZ, and Westpac:** These major banks are standard first stops. They will review your last two to three years of IRD tax returns, personal/business financial statements, and GST returns to calculate a consistent average or sustainable baseline income. * **Kiwibank:** Often competitive for first-home buyers, Kiwibank handles contract and self-employed income regularly, provided the accountant-prepared figures show stability. * Non-Bank and Specialist Lenders (Tier 2) If your contracting income fluctuates significantly year-on-year, or if your tax deductions make your net taxable income look low on paper despite strong cash flow, you can look at alternative lenders: * * **Pepper Money NZ:** Specialises in flexible or alternative documentation lending. They understand non-standard income structures well and accept a 20% deposit for residential loans, though their interest rates may sit higher than Tier 1 banks. * **Resimac:** Another prominent non-bank lender in New Zealand offering prime and specialist lending options for borrowers with non-traditional income histories. * Recommended Strategy Rather than approaching banks one by one yourself, working with a **mortgage broker** who specialises in self-employed and contractor applicants is typically the most efficient path. A good broker knows which specific bank policies are currently friendlier toward contractors and can package your three years of financials in the best light before submission. You can check independent guidance on structuring these applications via MoneyHub. If you'd like, let me know: * Whether your contracting income has been **steadily rising, stable, or fluctuating** over those three years * If you use an ** accountant** to prepare your financials I can give you a better idea of **how a bank will calculate your borrowing capacity**. --- ## ai-overviews Answer ID: a0a468c9-8a0a-49a3-ad25-671dac6e4e54 **With three years of strong financial records and a 20% deposit, you are in an excellent position to secure a home loan from New Zealand's mainstream retail banks.** Mainstream banks typically require a minimum of two years of accounts for contractors and self-employed individuals. Because you exceed this benchmark and have a solid **20% deposit** (which avoids low-equity penalties and strict Loan-to-Value Ratio restrictions), you do not need to limit yourself to specialist lenders and can qualify for standard market interest rates. The best lenders to approach are categorized below based on your borrowing profile: Mainstream Retail Banks (First Choice) You should approach these first to secure the lowest interest rates and potential cashback offers: * **ANZ New Zealand:** The country's largest residential lender; highly experienced with complex self-employed income structures. * **Westpac NZ:** Known for flexible assessment criteria if your contract income fluctuates between years. * **ASB Bank:** Offers competitive packages for first-home buyers and streamlined processing for standard self-employed applications. * **BNZ (Bank of New Zealand):** Features strong lending panels that look closely at "add-backs" (like depreciation) to maximize your borrowing power. * **Kiwibank:** A great local option that regularly supports first-time buyers with competitive pricing. Non-Bank & Specialist Lenders (Backup Choice) If mainstream banks find an issue with your contract continuity or industry gaps, these providers offer flexible "Alt-Doc" (alternative documentation) loans, though often at slightly higher interest rates: * Pepper Money NZ: Specializes in self-employed and contractor options using recent bank statements or GST returns rather than strict profit-and-loss averaging. * **Resimac NZ:** Provides tailored solutions for borrowers who do not fit the rigid criteria of traditional banks. * **Liberty Financial:** Known for its open-minded approach to variable contractor income and non-standard employment. * **Avanti Finance:** Offers flexible near-prime lending options for complex financial profiles. 💡 Pro Tip for Contractors Because every bank calculates contractor income differently (e.g., some average your last two years, while others take the lowest year), it is highly recommended to work with a **mortgage broker**. A broker can package your three-year history to the specific bank whose policy best fits your industry, saving you from multiple credit checks. If you'd like to narrow this down, let me know: * Is your contract income **stable, increasing, or fluctuating** year-to-year? * Are you looking to buy an **existing property or build a new home**? * Do you operate as a **sole trader or through a registered company**?