Many homeowners discover to their Delight that once they have lived in their house for a few years then the property vale will have increased substantially plus they will have paid off a chunk of their mortgage, so its important to choose your broker carefully. What this means is they discover that they have significant equity and their property that any bank will be happily to loan against.
It’s a natural increase in the home owners equity there’s also a matched by the homeowner improving their employment situation and earning more money, in the homeowner who likes to show off will feel like they are in a position to buy a new car and to make the payments on the car. That way you’l have the best mortgage brokers Upper Hutt has ever seen.
For many reasons a brand new vehicle for normal home owner does not make financial sense, because the car loses probably 20% to 30% of its value as soon as it is driven off the car yard, and it’s value continues to degrade after that. By contrast almost all property for which a mortgage is obtained then increases in value over time so that the owners equity is always escalating.
However this logic does not seem too concerned a large number of homeowners in New Zealand or around the world, and they are quite happy to add to their home mortgage in order to purchase a new vehicle. This at least makes more financial sense then using a finance company for purchasing the vehicle, as the finance company interest rates will be a lot higher and the terms will be a lot more onerous. On the other hand if the homeowner is unable to make payments on the loan from the bank then they could lose their home and their car, so they need to go into the process with their eyes wide open.
A mortgage broker Lower Hutt can seriously reduce the risk of any such transaction by helping the homeowner to fully understand their financial situation and obligations, and also negotiating for the increase mortgage on their behalf. The mortgage broker may even change the homeowners Bank and refinance the property, as this can often be the most economic solution given that banks are always on the lookout for new business. For all that it can be very uncomfortable for many homeowners to contemplate adding a depreciating vehicle to their list of assets for which they are paying a mortgage, and this type of purchase and financing is definitely not for everybody.
An interesting aspect of the new car market is that almost every new car on the road is either a company vehicle or has been purchased by an individual who needs to raise a large loan, as there are very few individuals that can afford to pay cash for a brand new vehicle. There is a significant sector of the population who have more economic sense and would never buy a new car when I 3 year old second hand car can do the same job for a fraction of the cost, and this group of people can look at those driving new cars and feel somewhat smug that their financial acumen is substantially superior to the new car owners’.