Why work with a mortgage advisor? Tapping into your KiwiSaver and access First Home Grants
Saving a deposit for a home has never been harder, however there is some assistance available in some scenarios that can help.
If you are an employee you may already be enrolled and contributing to KiwiSaver.
KiwiSaver is a voluntary savings scheme to help Kiwis save for retirement. The initiative is designed to encourage you to create and maintain a consistent pattern of savings.
The savings are a combination of; contributions that are made to your account, investment returns (both plus and minus), minus withdrawals and fees and taxes.
For people who are employed, the contributions made to KiwiSaver will be completed through their employer and come out of their wages. However, for those who are self-employed or unemployed the deposits to Kiwisaver are up to you. It is important to understand what the right level of contributions might be for you.
If you qualify, the government also makes a contribution each year, to help Kiwi’s towards their savings targets.
When can I access the funds?
For most people, the funds in your KiwiSaver will currently be accessible once you are 65 or if you have joined Kiwisaver late, once you’ve been a member for at least five years.
However If you’re buying your first or second home, you may be able to access the funds earlier provided you meet a specific criteria.
Your Loan Market mortgage adviser will be able to tell you what they are and assist you through the process of accessing your KiwiSaver funds.
First Home Grant
If you are a first home buyer you may also be eligible for the government's First Home Grant.
In order to qualify for the First Home Grant you need to meet the following criteria.
- Be 18 years or over.
- Currently do not own a home or land.
- Have not received the KiwiSaver HomeStart Grant or its predecessor the KiwiSaver deposit subsidy before.
- A member of a KiwiSaver scheme, complying fund or exempt employer scheme (contact your scheme provider to check your scheme is eligible).
- Have made the minimum contributions to the Kiwisaver fund over a 3 year period.
- Be sole buyer and have earned $85,000 or less (before tax) in the last 12 months.
- Be two or more buyers who have earned a combined income of $130,000 or less (before tax) in the last 12 months.
- Have a deposit that is 5 percent or more of the purchase price. (The 5 percent deposit includes the money you can withdraw through the KiwiSaver first-home withdrawal feature, the First Home Grant amount you or the other purchasers may be eligible for and any other funds, such as savings, term deposits or funds already paid to a real estate agent or solicitor. The deposit can also be gifted by a relative with a gifting declaration.) Note that the deposit cannot be borrowed or secured against other property, equity gifts, credits on settlement or family guarantees in order to qualify.
- Be buying one of the following types of property and land arrangements:
- fee simple
- stratum estate (freehold and leasehold)
- cross-lease (freehold and leasehold)
- Maori land
- Or be purchasing an equal share in a property proportionate to the number of intended property owners.
- You must live in the home for 6 months following settlement or code of compliance being issued if building a new home.
The purchase price of the property is within the regional house price caps as shown in the below table:
If you are wanting more information or to know if you are eligible, please get in touch. Also make sure you get your tickets to our Wanaka First Home Buyers Evening on October 30th, 2019. You can find out more information and reserve your free tickets here.