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Mortgage Broker Issues

Clients of mortgage brokers often run into issues, which they may or may not complain about to professional bodies. The mortgage broker sector has improved markedly since 2010 after the NZ government brought in new regulations requiring mortgage brokers to be fully qualified financial advisors, but in spite of brokers being part of a recognised dispute resolution scheme, many issues still arise.

Tina Park, mortgage broker
Tina Park, mortgage broker

Prior to 2010 the main problem clients were having with mortgage brokers were that often they were just simply incompetent or unscrupulous, and for example they would supply incorrect information about their clients to the banks or lenders in order to win a mortgage for their clients. Also they would feed business to independently wealthy investors who would charge a much higher interest rate, when the client could have gone straight to a bank and got good market rates. A lot of their clients were in serious difficulties once the general financial crisis occurred 2008, and a lot of these difficulties could be placed at the feet of their mortgage broker.

Nowadays almost all the Cowboys brokers have been well and truly weeded out of the system, but the clients are still running into problems. One common example is the clients finding that the brokers they talk to just can’t help them, and don’t even seem to want to try. The problem for them is it they are talking to the wrong brokers, because if they have called one of the largest mortgage broking firms they will not have realised that the firm would have pre-screened then and eliminated them as a potential client simply because their situation looks somewhat different or potentially difficult. If the clients went to an independent broker such as the ones at then it’s far more likely they would receive service, because independent brokers need all the business they can get.

There also occasionally appears to be a degree of racial bias in some mortgage brokers, who refuse to take on some clients simply because of their accent or because of the broker’s assumption about their nationality. In these cases the client just have to keep on trying different mortgage brokers, and Google search is a great tool for those.

All brokers are supposed to deliver independent and professional advice, but many brokers have their favourite banks and high -net-worth investors who they feed a lot of business to, obviously in return for a favorable commission or access to a new line of leads. The problem here is that the broker would be unable to persuade their client that they are getting the very best deal if they were to tell the full truth to the client. This is dishonest and risky behaviour by the mortgage broker, as they could be found out if the client where to visit another broker and explain their situation. To find out more about Rotorua mortgage brokers click here.

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Mortgage Broking as a Business

Any mortgage broker in New Zealand needs to be fully qualified and registered financial advisor, and this alone requires a high degree of financial and time commitment. Mortgage broking as a career cannot be taken lightly.

Karen Parker, mortgage broker at

The mortgage broking business is somewhat unique in New Zealand, in that the broker does not charge the customer any fees, but is instead paid a substantial commission once the customer has uplifted the loan. While the payday may be substantial, the time between signing up the customer and getting paid can be many months some cases. And for the broker in New Zealand, on the average only 30% of new customers end up earning the broker any commission.

The broking business requires careful cashflow management as well as the other obvious skills of marketing, networking and financial advising. Find out more about mortgage brokers in Timaru. In some respects mortgage brokers are like the dairy farming sector, as farmers are always banking any unexpected or particularly good profits because they know that good times never last. The mortgage broker really needs to take the same approach.

Mortgage brokers obviously prefer to take clients from the very large cities with the very high house prices and high mortgages, as the commission payments can be double or even quadruple the payments that brokers will be getting in the smaller centres. However there is large competition for this business, and unless the broker is tied to a large mortgage broking firm with a very expensive marketing budget and successful SEO Internet advertising campaign, then they will not see much of this lucrative business. Of course the disadvantage for mortgage brokers working for the very large companies is that they have to take the work that is given to them, and often the work is fairly repetitive although lucrative.

The large mortgage broking firms generally find they have so much new business coming in through the door as a result of the Internet campaign that they can afford to put administrative staff at the front end to filter out all but the simplest customers. This is not truly ethical but it absolutely goes on, simply because there are so much money to be made by the very dominant large mortgage broking firms.

Smaller independent brokers need to have other sources of new business, but this always means that they need to provide good service at all times, because their good reputation has such a huge influence on their livelihood.

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Financing Large Commercial Building Projects

Large commercial building projects can be very complex financially, as different types of financing are required at different stages of the project, and the amount of financing required can be enormous and require multiple lenders to be involved.

Joyce Miller, mortgage broker

This type of project requires a specialist mortgage broker that has a good understanding of the nature of these types of projects, and where to go for the different types of financing. Developers generally have their preferred mortgage brokers who they know and trust to swing the deal, and they will have let their mortgage broker know well in advance about what their plans are and how much it was going to cost. To find the best mortgage brokers in Hawke’s Bay click here. A smart broker will understand the needs at the different stages of the project and will start lining up their financial options, including alerting key non bank lenders that a big project was coming up.

The developing may be using existing land that they have hung onto for a long time or they may need to purchase the land before they can start the project. At this stage the project may appear to a normal bank to be to risky, and the broker may need to go to a non Bank lender who was prepared to take higher degree of risk but obviously for higher interest rate. If you need Bay of Plenty mortgage brokers click this link. The developer will also need to secure finance for the planning and consenting stage, and the broker may bundle all the lending for the section purchase and the planning stage into one loan.

Unless the developer is a very high net worth individual with liquid assets, they will most probably need to do all the development using debt. The actual build project will require a whole new set of financing, and a smart mortgage broker may be able to roll all of the debt for the section purchase and planning stage into the financing required for the build. Once the actual project has begun in the risk is obviously decreased and financial interest rates will be cheaper and finance companies will be more willing to lend the money.

The actual financing for a build project takes place in different stages, with a tranche of finance being advanced at the start of the project, the second tranche being advanced once all the foundations have been poured. The second tranche will cover all the costs around the building erection, and a third tranche may be advanced once the building is complete and the internal fitting has to take place. At this point the risk in the project will have decreased significantly, and most probably all the key tenants will have signed on, so this is the point which will deliver the most attractive interest rates and terms for the developer.

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New Home Buyers: Mortgage Brokers Love Them!

First time home buyers can find the whole process very intimidating, and while they know that they should be getting on the property ladder as soon as possible, they are also naturally very apprehensive about the massive debt that they will have and the massive obligations they will have to make regular payments.

As an indepenent mortgage broker, Kim McGunther loves working with first home buyers.

For many first time buyers this is so intimidating that they just simply procrastinate getting into their first time. However a very smart first move for them can be to contact a good mortgage broker, as the mortgage broker will be able to quickly assess the likelihood of getting a good home loan and their ability to manage the mortgage payments. Many people have a good income and have made good savings for a deposit but they have still not taken that first big step of buying their first home.

Mortgage brokers who specialise in dealing with first home buyers understand that in many cases their clients will need coaching, motivation and even cheerleadering to get them over the threshold of their first home. The mortgage broker is perfectly set up to do this (especially in Palmerston North), because he or she knows that they will not get paid until their client has taken the keys for their first home, and so they are very motivated to make sure their client succeeds. Once the client talks to the broker things will start happening very quickly as the broker will need to find out the clients exact financial situation as quickly as possible. They will be a constant thorn in the client’s side until they have supplied this information, and then they will find that the broker moves very quickly to develop an application for the appropriate bank. The broker may have quite a challenge to put the the client at ease about the massive debt that they are taking on, but a good broker will be able to explain things to the client in such a way that it does not appear nearly so scary.

It is important that the broker does not position the deal as absolutely essential, as some clients tend to be scared that they are missing out by not being in the housing market but then put themselves at huge risk by taking on massive debt they cannot afford. It is the brokers job to make certain that this does not happen, and it is also in the brokers best interest because if anything does go wrong down the track then they can lose all of the commission and their reputation.

A good broker will keep their client informed it every step along the path, and they will have carefully selected the appropriate lender and the best lending product for the clients needs. They will make sure that the financing is setup so that it is delivered at the correct time on the correct day to the correct solicitor. Often a broker will tell their new client that they will be “their broker for life”, and that they will contact them periodically to make sure that all is ok and that everything is working well. This will be seen by the client is very good service indeed. For those looking for mortgage brokers in New Plymouth, click here.

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Tree Problems in Hastings

Hastings landowners and homeowners often have to deal with tree problems, sometimes after serious storms and sometimes simply because the trees have become too large or unruly. They may need the trees to be seriously pruned, or they may need the trees to be removed altogether, and in almost all cases the sensible homeowner and landowner or realise the job is far too dangerous to do by themselves and they will need to call in the professionals.

Certain tree-felling techniques can avoid having the tree land in unwanted places

In previous times they would simply consult the Yellow Pages, but in modern times in Hastings it is a simple job to type into Google the words arborist Hastings, and then choose from one of the many arborists that are listed.

One needs to be careful that they choose a professional company, simply because of the danger of the work being done in an unsafe manner, but fortunately the industry is extremely safety-conscious and heavily regulated and so any arborist turning up in a Google search should almost always be able and confident to do the work.

The aspects that will most intimidate the normal householder or land owner will be issues like the tree being too close to a building or a neighbouring property, for the branches that are causing a problem being simply too high. It is always a great relief when the professionals turn up and indicate that this type of work is their bread and butter and should cause them no troubles.

The reason why the professionals can make these claims is because they will have many years of experience and will have been highly trained. The work is almost always very dangerous, and it takes a very skilled and experienced and fit operator to work around all of the many dangers. If one wants a true appreciation of the level of skill and fitness required one just needs to apply for a job as an arborist.

It is almost always a job for fit younger man, simply because it is a very physical job, and the operators need to work very fast but safely in order to be competitive in the marketplace. Skilled operators are a joy to watch, because they are obviously very experienced in all aspects of safety and how to drop a tree. Just working with a chainsaw all day would be exhausting for the average person, but a professional chainsaw operator needs to do this at speed, and often hanging high up in a tree.

The cost of accidents in the tree industry is enormous in terms of a medical expense, lost time and compensation for the injured worker, and therefore it makes enormous economic sense for the companies involved to place a huge emphasis on safety and physical fitness.

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Manufacturing New Houses At Scale

All of the 20,000 or so new houses that are built in New Zealand every year are built using a largely manual process  by skill builders. There is currently a shortage of around 5,000 builders in New Zealand, and any new home buyer will have to wait at least a year to get their house unless they are prepared to bribe somebody. Apparently there are fewer houses to be built in Auckland than originally predicted.

A very attractive alternative for New Zealand is the large scale manufacturing of new houses by one or two companies,  as these companies just need to purchase the automation and robot equipment and then get going. Overseas such companies can build more houses in their one manufacturing plant then as built in all of New Zealand, and by building at this very large scale they are able to keep their costs probably 50 below the equivalent building a New Zealand. Also they are able to produce vastly more houses, and do this profitably because the labour component for each house is only a fraction of what others for the current New Zealand building techniques.

Simply put, the more houses the manufacturer can manufacture then the cheaper the houses will be.

Out at the building site the job of the skilled builder changes from having to be a jack of all trades particularly when erecting framing and roof trusses and all the work involved, and instead being an assembler of very accurately manufactured wall panels  and roof. Erecting the pre manufactured wall panels and roof  just needs a good crane and a good operator and a couple of skilled builders for a day, and this has been proven on one good example by a major manufacturer.

The builders then need to go through the house to fit it and finish it, but we’re as normally it would take them probably 3 weeks to get to this point, it can be as little as two or three days with a prefabricated house.

The beauty of this modern technique is not only that the houses are much cheaper to build this way, they are also much faster and the panels and the finish is much higher quality simply because the fabrication process in the factory users full automation and computer aided design and processes.

The customer is also very happy in the process, because not only do they get a much cheaper house, they get a superior fitting finish and plus they get a house that is their own design, in the sense that they have chosen the house from a large Bunch of plans. It is the modern way to order anything, and it is surprising that this type of manufacturing process has not yet taken off in New Zealand. However the new government may become a large-scale purchaser of new housing, and this in itself maybe enough encouragement for a manufacturer to make the large capital investment needed in the automation and Robotics equipment.

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