Why Choose us?

 

1. We are  loan experts with twenty five years of  bank experience in home and commercial lending.

2. We make your loan raising exercise hassle free.

3. We can examine and restructure your loan, cutting years off your mortgage and save thousands of dollars.


Welcome to New Zealand’s favourite Mortgage Website
 
In current scenerio, where banks change their  lending policies every other day, raising a home loan, business loan or commercial property loan and getting a good deal is a complictaed exercise.  That is why you need services of an experienced financial adviser who has up to date knowledge of lending industry, understands lending criteria in depth and can arrange best offer for you while you relax at home.
 
Our experts at Cherry Mortgage Solutions with wealth of knowledge and extensive experience (20 years as Bank Manager in New Zealand, U.K/overseas) take stress and confusion out of your loan hunting exercise and make it a simple and easy process. We fully understand, every borrower has a unique situation and work accordingly.

With our strong relationship with lenders we can arrange home or residential investment property loans even upto 90%. We also arrange business loans and commercial property loans at most competitive terms and interest rates.

We take special care of first home buyers, and guide them at every step of home buying process. Our solutions for your mortgage or Business Loans are designed around your unique situation and needs. We also examine for free, your current loan structure and if needed restructure it which can make you pay your loan faster and save many thousand dollars.

Cherry Mortgage are one stop solution for both your loan and insurance needs. We cover all your risks by suitable insurance covers like, life cover, trauma cover, income protection, mortgage protection and medical cover from a range of prominent insurance companies at most competitive prices and take over all hassles of related paperwork.

Contact us on 09 625 3800 or
enquire online and we will make it a stress free pleasant experience for you. We are available all seven days of week and can come over to you.
90% Home Loans at Cherry MortgageLatest on Cherry Mortgage

July 24, 2014

Reserve Bank of New Zealand raises OCR to 3.50%

 The

The Reserve Bank today increased the Official Cash Rate (OCR) by 25 basis points to 3.5 percent.

New Zealand’s economy is expected to grow at an annual pace of 3.7 percent over 2014. Global financial conditions remain very accommodative and are reflected in low interest rates, narrow risk spreads, and low financial market volatility. Economic growth among New Zealand’s trading partners has eased slightly in the first half of 2014, but this appears to be due to temporary factors.

Construction, particularly in Canterbury, is growing strongly. At the same time, strong net immigration is adding to housing and household demand, although house price inflation has moderated further since the June Statement.

Over recent months, export prices for dairy and timber have fallen, and these will reduce primary sector incomes over the coming year. With the exchange rate yet to adjust to weakening commodity prices, the level of the New Zealand dollar is unjustified and unsustainable and there is potential for a significant fall.

Inflation remains moderate, but strong growth in output has been absorbing spare capacity. This is expected to add to non-tradables inflation. Wage inflation is subdued, reflecting recent low inflation outcomes, increased labour force participation, and strong net immigration.

It is important that inflation expectations remain contained. Today’s move will help keep future average inflation near the 2 percent target mid-point and ensure that the economic expansion can be sustained. Encouragingly, the economy appears to be adjusting to the monetary policy tightening that has taken place since the start of the year. It is prudent that there now be a period of assessment before interest rates adjust further towards a more-neutral level.

The speed and extent to which the OCR will need to rise will depend on the assessment of the impact of the tightening in monetary policy to date, and the implications of future economic and financial data for inflationary pressures."

 Cherry Newsletter September 2014

  

Current Mortgage Interest Rates* as on 12th September 2014
 
Variable                      5.75%
6 Month Fixed             5.40%
1 Year Fixed                5.60%
2 Year Fixed                5.75%
3 Year Fixed                5.85%

4 Years Fixed               6.35%
5 Year Fixed                6.60%
*Conditions apply

These are not published rates of the banks. But Cherry Mortgage will be able to get you above interest rates and may be   even better if loan amount is high and subject to certain other terms and conditions

 

Economic Outlook

The New Zealand economic recovery has passed its peak. It grew strongly through the first half of 2014, but the pace is currently slowing. New Zealand Institute of Economic Research forecast economic growth will ease from 3.5% in 2014 to a still respectable 2.7% in 2015.

Reserve Bank governor Graeme Wheeler kept the official cash rate at 3.5% and signalled he won't be as aggressive with future rate hikes as previously thought as inflation remains tamer than expected.

Wheeler kept the key rate unchanged, as expected, saying the economy was adjusting to the bank's rate hikes earlier this year, though risks still remained as to how much strong net migration will impact on housing, and the extent to which construction activity spills over into broader inflation.

 The Reserve Bank cut the forecast track for the 90-day bank bill rate, often seen as a proxy for the OCR, by about 50 basis points over the projected horizon, with the rate rising to 3.9 by March next year and 4.8% by the middle of 2017 Some economists rather do not see the OCR to rise until early 2016.

Interest rate Scenario

The attractiveness of fixed mortgage rates compared with the higher floating rate is encouraging borrowers to fix their mortgages. With OCR on hold for long and banks funding costs from overseas borrowing falling, they are in a good position to compete hard and have been offering attractive fixed rates. But a lot depends on how strong is your negotiating power which comes with low LVR, high loan amount and sufficient income. Talk to us to discuss your situation as what best rates we can get for you.

Medium to long term fixed rates depend more on wholesale interest rate moves than the OCR. They also depend on the banks' funding costs on international markets, which have been falling in recent months as financial markets are calmer.

A good strategy is to fix over two to three years after negotiating hard with the banks and keeping sufficient amount in revolving /floating depending on how much surplus funds you expect to get during your fixed interest period that you choose.

Talk to us to have a no obligation chat as what should be your loan structure to pay your loan faster in your unique situation.

  Housing Prices growth slows down

New Nationwide residential property values for August have increased 6.9% over the past year and 1.7% over the past three months as per latest QV Residential Property Report. The Auckland market has increased 11.4% year on year and values are up 33.0% since 2007.  When adjusted for inflation values are up 9.7% over the past year and are 13.8% above the 2007 peak. Sales volumes and home loan approvals are down year on year and interest rate rises, LVR restrictions and the upcoming election appear to be keeping the number of homes on the market low as well.

New build houses are also selling well and attracting good prices. As there are no LVR restrictions on lending for new builds this may account for the stronger interest in this sector.

In additional to seasonal slowdown of winter season, three factors which are containing the housing market are LVR restrictions, rising interest rates,  and  uncertainty due to forthcoming elections as people want to see who governs New Zealand before making a property  investment decision. On the other hand, high level of immigration is keeping housing demand growing.

Land prices have risen sharply. Though they eased following the housing market peak in 2007, they remain high relative to history. Construction costs, on the other hand, have not risen as much.

Who's buying?

One of the studies indicate that about 8 per cent of  house purchases are possibly being made by overseas cash buyers, according to data from property information and analysis company CoreLogic. But of the rest, almost half the property that changes hands - 45 per cent - goes to investors.

Another 28 per cent of purchases are by people moving from one property to another. Investors tend to buy and hold, accumulating more and more houses. Owner occupiers, on the other hand, tend to turn over properties more often, as they move up and down the real estate ladder. However, date on   wealthy foreigners pushing up prices is very limited and noting can be said with certainty whether this is effecting housing market too much.

 

Buying Commercial & Industrial properties

Banks apply different lending criteria to   assess the risks associated with commercial and industrial properties, than what they apply for residential loan applications.

Why is it so? In fact, there are many differences between the risks associated with commercial and residential lending which necessitates completely different lending criteria.

HOW MUCH LOAN WILL I GET

A major difference is the level of debt that banks will allow borrowed against commercial property. Banks these days lend up to 90 or 95% on residential properties, the norm for commercial property is 65% of value. There are some lenders who would look at 75%, but this would depend on the lease profile of property and the merits of the property and the strength of the borrower.

Lending on Commercial property has gone through substantial changes in New Zealand due to recent earthquakes in Christchurch and Wellington.

If you are planning to purchase a commercial property, you should be aware of the National Building Standards (NBS).

As a rule, earthquake risk buildings are defined between 34% and 66% NBS.  If NBS of a property is less than 34% it is defined as high risk or earthquake prone and banks do not lend against security of such properties. .

The building Act 2004 requires local authorities to put a policy in place in relation to earthquake prone, dangerous and insanitary buildings.  Councils have five years to assess all non-residential and multistory residential units and as per today’s decision owners have a further 15 years period to strengthen their buildings so as to bring up to required NBS of 34%.

In order to purchase a commercial or industrial property, you require at least 35% of deposit in cash or can use equity in another property, if available.

If you talk to your bank or a financial adviser having good understanding of commercial lending, you can come to know how much you can borrow on a particular identified commercial property.

TENANTS

The main reason for this conservative approach by banks is the 'tenant risk'. Tenants for commercial and industrial properties are businesses with their own associated risks.

Some important factors that should be taken into consideration are:

Length of time the tenant has been there and Length of the lease

Banks consider the length of a lease to be a major factor while assessing the lending risk. They will not favour short term leases, which have risk of tenant moving out leaving a vacant property. This would seriously affect the property’s cash flow and hence the ability to service the debt.

Other important factors include:

·       Type of business of the tenant.

·       Time they have they been in business.

·       Tenant’s financial strength.

·       What future holds for this type of business?

Obviously, property owners will not have access to the financial accounts of their tenants, banks will use the length of time the tenant has been in business and their past tenancy period at this location, as an indicator of their financial strength.

If you want to discuss any particular situation, feel free to contact us

 

 

 

Cherry Mortgage Solutions Ltd

P O Box  27 - 070 Mt. Roskill
Auckland 1440
New Zealand

Ph  : 09 625 3800
Fax : 09 625 3801
(M) : 021 82 7575
Email: info@cherrymortgage.co.nz

Business Loan, Commercial Loan
Expert advice on home loans
 

 

Home Loan Broker


 »Total Hits: 3123