How to get clients approval when the banks say "no"

Jayden: [00:00:19] Welcome to New Zealand Adviser TV. My name is Jayden Fennell and I'm the news editor for New Zealand advisor. Joining me today is Nathan Miglani, managing director and chief advisor at Loan Market Paramount. Nathan has just been recognized as one of the top mortgage advisors in New Zealand. Congratulations on this award win, Nathan, and welcome to New Zealand Adviser TV. 

Nathan: [00:00:39] Thanks, Jayden. Thanks for having me. Good to catch up with you. 

Jayden: [00:00:45] So Nathan, what is your background and why did you decide to become a mortgage advisor? 

Nathan: [00:00:50] My background was actually in mortgages. I was lucky enough to spend good quality time in NZ Bank and I got trained by some really good people at NZ that set the foundation for mortgages. I was going as a home loan specialist for NZ Bank so that quite successfully and then jumped onto mortgage advice because I just I was just in love with building that relationship with the customer. And to be honest, that might sound a bit funny still at a date. I don't really love mortgages, but I love building relationships with people. And mortgages happen to be a part of it. And I was just just sort of frustrated in my own good, loyal clients that were just getting better deals elsewhere. And I knew that getting better deal and sort of working in residential space. I was not able to help business banking clients because at the bank, you know, you've got different divisions. If you do residential, residential, you can't do business, you can't do commercial. But yeah, I just absolutely love it because now as a mortgage advisor, I can do everything from a first home to multi-story developments to someone helping buy a truck or a section selling property. It's just it's opens up a lot more options for people. And I sort of knew that's where I want to be and what I want to do. So hence it was no brainer jumping from the bank to a mortgage broker quite early in the career. 

Jayden: [00:02:22] Nathan, what makes you one of the top mortgage advisors in New Zealand and what makes Loan Market Paramount so successful? 

Nathan: [00:02:29] Oh, look, honestly, We just follow the process and then hopefully the proceeds will come and yeah. Look, I never looked being successful. To be honest, I'm just as grounded as I was in my first week of being a mortgage broker. And I guess the reason why we've done well, if you say over the last few years, it's all about our team. As a team, we just so close. We share everything openly. We are a business. We everyone can just have their opinion. They can question, they can raise concerns, they can literally have argument on anything. I think that's just a freedom of speech, to be honest. The whole thing works collaborative and I genuinely, to my gut, I hate the word stuff and I hate the word employees. I just feel we all working towards the same mission that we want to grow ourselves. We want to we want to improve ourselves and hopefully that can help us achieve our long term goal. That's just being the best known mortgage advisor business and Canterbury. I've got no desire honestly to be happy in Auckland or and Wellington, but I really want to make sure that if anyone thinks of mortgages in the next ten years time they should think of us. And it's all, I'll give all the credit to my team because I'm just literally leading them from the sides and from the bank. They actually leading at the front. So they are the reason why I'm here and I'm very grateful for that. 

Jayden: [00:04:13] Nathan, what trends are you currently seeing in the housing market? 

Nathan: [00:04:16] Oh, it's going from nuts to normal. The frenzy, like our most popular economists, Tony Alexander, always say it was fear of missing out and now it's fear of overpaying. And I guess now it's just not fear, but it's just I think people are not really motivated to do anything. And everything is driven by emotions. Everything is driven by how well you're doing. I have few lines there. Car salesmen, and they had the best year ever. They've made so much money over the last couple of years than what they've made in the last five, seven years. Because, you know, when the house prices go up, people feel rich and they go and spend. And and I guess everything is driven by affordability, really. At the same time, last year, in fact, one of my rentals were two and a half percent, and now it's up for renewal and I'll be fixing it nearly 5%. So affordability also depends. How much money do you want to spend? So what I'm saying is some parts of the country is reacting different to this inflation. Queenstown is going different. Auckland is different. We are just very fortunate to be  in middle of Christchurch. It's just sticking along really well. I try, I mean 99% of my businesses, so I don't really know. I'm not on the ground in Auckland, so I don't know what's happening in day to day in Auckland, but I think in Christchurch market is ticking along really well. It's, it's just gone from nuts to normal really. 

Jayden: [00:05:52] Nathan what are your top tips for first home buyers trying to secure their dream home? 

Nathan: [00:05:55] Well, the top tip is like talk to a mortgage adviser, please do not go to a bank. Honestly, I know hand on heart we can provide 100 times better service than what they get. They can just get from the bank. Yeah. They really need to know what the options are. And there are so many options for first home buyers right now. I had a client last week, been to a broker, got the client, went to their own bank, of course, declined. And we've just very successfully managed to get into their first home with just 5% deposit, you know, but all the negativity aside in the media right now, there are still options for first home buyers to buy their first home with as little as 4% deposit. So so if you bank with a bank who's got no option of 4%, how would you know? And if you walk into the bank next door, well, they might not do 5% either. So and then you end up getting frustrated. So I think every first home buyer need to talk to a mortgage broker just to avoid a lot of confusion, stress. And I think all the brokers will probably agree how much work we do to help foster buyers taking them from right on application until they settle on the property. Yeah, we need to get paid more, but yeah, that can be on the wish list. So it is what it is. 

Jayden: [00:07:20] We know that banks are getting stricter when it comes to lending. So have you had any clients who direct to the bank and were declined, however, then visited you and your team and you were able to get an approved? If so, How? 

Nathan: [00:07:31] On a daily basis, I think that's what we sort of do. Being a mortgage adviser, all you do is just provide clients with lots. And look, I'm not going to say the banks are not doing their job or not. I used to be a banker. And I've got a lot of respect for people who work for the bank because, you know, a lot of people, they do work hard. But reality is it's. Like I said before, people here, do they have an approval or not? So so I might have a different policy for investors. Bank B might actually look at completely different. So everyday we've got clients into the bank, their policy is not sticking up. And honestly, what we've done, we've just we know the Bank might be the best bank for these guys because they may look at the overall scenario is what how we present they might not take your every rights of each property into account. They won't take every insurance into account because how do you get approved? No, no one makes million bucks. You know, people still want to buy property. People still want to buy investment property. And the biggest thing we've seen over the last six months, I think majority of the mortgage approvals are done for investors. There have been to the bank and they've said no and all we've done is just put them into the right bank. And it all depends on that. We've got five different banks. Five have different answers for each application. This is how crazy the terms are. 

Jayden: [00:08:59] So, Nathan, let's talk about investors. Is now a good time to invest in property? 

Nathan: [00:09:04] Of all experienced people will agree this is probably the best time to buy investment property. But again, you need to be really careful. I mean, I often when I interview clients, I put a big screen right here and I always like to show them, hey, look, if you do interest only or if you do PNI, this is how much your mortgage payments are, this is how much your rights ballpark will be, loan boarding fee, resident association fee, insurance fee. You just got to be able to really take. Overview of why do you want to buy investment property? You just want to buy an investment property. It's a safe investment. You know, I have no idea. I've never invested in crypto and stuff like that or actually don't know anything about crypto. But I do have a few investment properties myself and I know if you manage those investment properties like a business, it can give you a good return and it gives you a good security for future. And buying investment right now is probably the best time, but you really need to pick up a right property at a right location, of course, at a right price. It has potential to go up. Don't take advice from people who are just selling someone's product and getting paid 25 grand plus GST. Talk to someone who can give you right advice. Why you should buy a townhouse. Why? Tell me why you should buy a townhouse. You know, I'm not saying townhouses are bad, but some houses you should never touch. Some townhouses are absolutely fantastic. So it all depends on you know, you've got to understand, buying an investment property can really make or break things. And I've seen so many people do really, really well. So many people just want to have an investment property. Just so it sounds good on dinner table. That's not a right way to do it. And investors right now can really take advantage of the low interest rate from some of the banks for new builds. And also the market is not that mental anymore. It's realistic. And if you back up some right investment property, I think there are some good deals around. And often what we always recommend to clients, if you've got two or three properties, your income is really well, you've got plenty of equity. Hey, let's have a look at, is it commercial property is better for you. I've just got a really good client of mine has bought a big commercial property and that commercial property will be paid off in 15 years, which makes a lot of sense to me. So we want to see successful. Put it this way. 

Jayden: [00:11:40] Nathan, thank you so much for your time today. And thank you to our viewers watching the latest version of New Zealand Adviser TV. 

Nathan: [00:11:47] Thanks, Jayden. Cheers. Bye.