7 Steps to Get Mortgage-Ready for Your First Home

Saving a deposit is a major achievement, but it’s only the beginning. If you're applying for a mortgage, lenders want to see more than just a bank balance. They want confidence in your ability to repay the loan and manage your finances.

Here are 7 critical steps to prepare yourself for a successful mortgage application.

1. Clean Up Your Bank Accounts

Lenders will request the last three months of your bank statements to review how you manage your day-to-day finances. They want to see evidence that you're living within your means, paying your bills on time, and not relying on credit to make ends meet.

To strengthen your application:

• Make sure your income is being deposited regularly and clearly labelled

• Aim to have a consistent surplus left at the end of each month after expenses

• Cancel or reduce any unneeded subscriptions or discretionary spending

• Avoid unarranged overdrafts or dishonoured payments, as these are red flags

• Check that your bank account activity matches what you’ll declare in your loan application

The goal is to show the bank you’re a low-risk, financially responsible borrower.

Learn More: The Importance Of Looking After Your Bank Account

2. Confirm Your Employment Status

Stable employment is one of the key factors that banks consider. They need to be confident that your income will continue in the foreseeable future.

To support your application:

• Provide a signed letter from your employer confirming your employment type (permanent, full-time, part-time, fixed-term) and your current income

• Include your last three payslips to verify consistency of earnings

• If you've received bonuses or commissions in the past two years, provide documentation. However, many banks no longer count future bonuses due to economic uncertainty

• If you're self-employed, submit your two most recent year-end financial statements. Some banks may accept just one year if your business is stable and profitable

• Include your IRD tax summaries if you're a contractor or sole trader

Banks also take into account the industry you're in. If your job is in a sector seen as volatile or seasonal, you may need to provide additional proof of income reliability.

3. Gather All Required Documents

A strong mortgage application is built on complete, well-organised paperwork. Missing documents can cause unnecessary delays or even result in declined applications.

You’ll need:

• Three months of bank statements for all accounts (including savings, everyday, and any joint accounts)

• Three recent payslips or two years of financial accounts if self-employed

• Valid photo ID (passport or birth certificate and driver’s licence)

• KiwiSaver statements showing your current balance

• Bank savings account statements as proof of deposit

• Gift declarations if receiving funds from family (the bank needs confirmation that the money is a gift and not a repayable loan)

• If you've found a specific property, include a property information pack, listing, or Sale & Purchase Agreement

The more thorough and transparent you are with your documents, the smoother the approval process.

4. Speak to a Mortgage Adviser

Mortgage advisers act as a bridge between you and the banks. They understand the different policies and lending criteria of various lenders, and they can match your application to the bank most likely to approve it.

Engaging with an adviser early in your journey can help you:

• Assess how much you can borrow based on your income, expenses, and deposit

• Understand the difference between fixed, floating, or split loan structures

• Navigate special loan options like low-deposit First Home Loans

• Get support preparing documents and completing applications

• Save time and avoid applying with banks that may decline your application

Mortgage advisers are usually paid by the lender, not by you, so there’s no cost to using their service in most cases.

You can arrange a chat with one of our First Home Buyers Club advisors here.

5. Prepare Your KiwiSaver Withdrawal

If you're relying on your KiwiSaver balance to boost your deposit, you'll need to begin the process early to avoid delays.

KiwiSaver Withdrawal

• Contact your KiwiSaver provider early to understand their processing times and what documents they require

• In most cases, you can withdraw all but the initial $1,000 government contribution

• If you're within 6–12 months of buying, consider moving your KiwiSaver funds to a Conservative Fund to protect your deposit from short-term market fluctuations

Getting your KiwiSaver withdrawal sorted early helps ensure your deposit is ready when you need it.

6. Run a Credit Check

Lenders use your credit report to assess whether you’re a trustworthy borrower. Any unpaid defaults or past issues can negatively impact your application—even if they’ve since been resolved.

Check your credit file before applying, so you can:

• Identify any outstanding debts or defaults

• Resolve any errors on your report before the bank sees them

• Add explanations for any negative marks if necessary (e.g., a default caused by redundancy or illness)

You can request a free credit report from providers like Centrix, Illion, or Equifax. Allow a few days for processing.

A clean credit file with minimal consumer debt is a strong signal to lenders that you’re ready for a mortgage.

Learn More: The Impact of Credit Scores on Mortgage Approval

7. Take Our Home Readiness Quiz

Not sure if you’re truly ready to apply for a mortgage? Our Home Readiness Quiz is a quick tool to assess how close you are to being ready.

It covers key areas like income stability, deposit size, financial management, and debt levels. Once you complete the quiz, we’ll provide feedback on what steps you can take to improve your chances of approval.

This is a great way to clarify your position and plan your next move with confidence.

Set Yourself Up for Success

The more prepared you are, the smoother your mortgage process will be. These seven steps are designed to help you present yourself in the best light to lenders—and give you peace of mind as you move forward in your home-buying journey.

For personalised guidance, reach out to our team of mortgage advisers. We’re here to help you every step of the way.