The questions and original answers

In New Zealand, the biggest risk in your situation is committing to buy the new home before you know you can complete the purchase if your current home hasn't sold.

A bank giving you an indication of how much you can borrow is not the same as having fully approved finance for this particular purchase. Before you make an unconditional offer, you want certainty about your funding, your ability to settle on time, and the legal and practical risks of the property you're buying.

An unconditional offer is a serious commitment. If you sign an unconditional sale and purchase agreement and then cannot settle, you could face significant financial consequences, potentially including losing your deposit and being liable for the seller's losses.

Your pre-offer checklist

1. Written, property-specific finance approval

Ask your bank or mortgage adviser to confirm in writing that the lending is approved for the actual house you want to buy, not just that you fit within an indicative borrowing limit.

Confirm:

• The maximum loan amount and required deposit.
• Whether approval depends on a valuation, LIM, building report, insurance or other conditions.
• Whether the bank is relying on the sale proceeds from your current home.
• Whether you need a formal approval letter before the offer can become unconditional.

Pre-approval alone may not be enough. Confirming your financesPrepare to make an offer

2. A clear plan if your existing home hasn't sold

This is the critical issue in your situation. Ask the bank to assess the purchase on the basis that your current home remains unsold for longer than expected.

Establish which arrangement you have:

• Bridging finance: temporary lending to buy before selling.
• Sufficient funds without the sale: you can fund the new purchase without relying on the proceeds.
• Sale-dependent purchase: you need your current home to sell to complete the transaction.

If you're using bridging finance, confirm the approved amount, duration, interest and repayment arrangements, and that you can afford both properties' costs for a realistic period. Also test what happens if your current home sells for less than expected. How bridging finance worksBridging finance - Buying & selling at the same timeBridging Finance

3. Your real deposit and total cash requirement

Work out how much cash you'll actually have available after selling costs, repaying your existing mortgage and accounting for any other secured debt.

Include:

• The deposit payable under the new sale and purchase agreement.
• Legal fees, valuation and inspection costs.
• Moving expenses and any overlap in rates, insurance, utilities and mortgage payments.
• A cash buffer if the existing property takes months to sell.

Don't assume the deposit for the new house will be covered by your current home's equity until the bank and your lawyer confirm how and when those funds will be available.

4. Insurance and property checks

Before committing unconditionally, arrange the checks relevant to the particular property:

• Confirm suitable house insurance is available on acceptable terms, including any material exclusions.
• Have a qualified professional assess the building's condition.
• Review the LIM and relevant council property file, including consents for alterations.
• Have your lawyer check the title, easements, covenants, ownership structure and sale agreement.

Pay particular attention to flood or land risks, unconsented building work, and anything that could affect the bank's valuation or willingness to lend. Prepare to make an offerConfirming your finances

5. Settlement dates and the legal agreement

Ask your lawyer to check that the settlement date is workable given the purchase funding and likely sale timeline for your existing home.

Confirm:

• When the deposit must be paid.
• Whether the settlement date can be met even if your existing property is still on the market.
• What happens if either settlement is delayed.
• Whether you should make a conditional offer with a finance, due-diligence or sale-of-existing-property condition instead.

Your lawyer should explain the consequences of default. Once the seller accepts an unconditional offer, you generally cannot simply withdraw because your circumstances have changed. Understanding the sale and purchase agreement when buyingBuying property in New Zealand

The questions I'd put to your bank before proceeding

You can send your bank or mortgage adviser this message:

Writing

We're considering making an offer on another home, but our current property hasn't sold yet.

Before we make an unconditional offer, could you please confirm in writing:

1. Whether we have full approval for the new property and the proposed purchase price, rather than indicative borrowing capacity or pre-approval.
2. Whether we can complete the purchase if our current home remains unsold, and whether bridging finance or additional lending is required.
3. The maximum amount we can borrow, the deposit required, and any remaining approval conditions.
4. How long we could comfortably carry both properties, including repayments and other costs.
5. What happens if our current home sells for less than expected or takes longer to sell.
6. What property documents, valuation and insurance evidence you need before final approval.

We'd like to understand exactly what must be satisfied before we can safely commit to an unconditional purchase.

The safest next step

My recommendation is to speak to both your mortgage adviser and your property lawyer before signing anything unconditional. In particular, ask your lawyer whether a condition requiring the sale of your existing home is appropriate, or whether you can safely proceed with confirmed bridging finance instead.

For further guidance, the official New Zealand resources are:

• Settled.govt.nz — Confirming your finances
• Consumer Protection — Prepare to make an offer
• Settled.govt.nz — Understanding the sale and purchase agreement

One important question for your situation: has the bank specifically discussed bridging finance with you, or have they only given you an indication of how much you can borrow? That distinction makes a big difference to how safely you can proceed.