Buying a home as a business owner

Despite the challenges the pandemic has presented, New Zealand businesses are booming – and self-employment is becoming an increasingly popular option for Kiwis across the country.

However, for business owners looking to buy a home, things can seem a little complicated. Fortunately, there are a few simple steps that self-employed borrowers can take to ensure a smooth application process.

Proof of consistent income

To prove to your lender that you can comfortably afford the loan repayments, it’s important to show evidence of your regular earnings.

While some lenders require at least two years of personal and business tax returns to confirm your income, there may be more flexible options available.

And, some lenders may accept alternative documentation, such as bank statements or an accountant’s declaration.

Check your credit score

In the lead up to your home loan application, it’s a good idea to check your credit score to find out where you stand.

Reviewing your credit file can alert you to any potential areas of improvement. A stronger credit score could help you to secure a larger loan with a lower interest rate.

A mortgage broker can support you to check your score and help to get your credit in good shape before you apply for a home loan.

Build up a deposit

Of course, having a strong deposit helps – and can sometimes support you to access a wider range of lending options.

However, many lenders also offer low-deposit options, which can help you get into your next home, faster.

Depending on your circumstances, you may even be able to access funds from your KiwiSaver account to contribute towards buying your first home.

To find out more about flexible lending options suited to self-employed borrowers, contact your local Mike Pero Mortgage Adviser today.