Now you’ve found your new home it’s time to dot the i’s and cross the t’s on your paperwork so you’re ready for settlement and moving in.
Settlement is when money changes hands and you officially become the owner of your new property. It’s an exciting, but nerve-wracking time, even though most of the hard work will be done by your lawyers and your bank.
Before you move into your new home, you’ll get the chance to do a pre-settlement check of the property. This is to make sure the property and the chattels are in the same condition as when you agreed to buy the property – for example, the dishwasher hasn’t disappeared or been replaced by a cheaper model, or a hole hasn’t suddenly appeared in the living room wall.
Take a copy of your sales and purchase agreement with you, so you can check which chattels are listed.
A pre-settlement inspection generally happens a couple of days before the settlement date, so the seller has an opportunity to fix any issues. If the property is a rental, you also need to give the seller enough time to give the tenants’ notice of an inspection.
If you do find issues that need fixing, talk to your lawyer or conveyancer straight away. They can talk you through your options and can also negotiate with the seller’s lawyers about getting things fixed or paid for.
Having house insurance is usually a condition of getting a home loan, so you’ll need to make sure it’s in place before settlement day.
As soon as you’ve got a home loan approved, then it’s worth reviewing your living insurance cover and thinking about adding life insurance to the mix. Have a think about whether you might need Income Protection Illness cover and Serious Illness Trauma cover to take care of your home loan repayments and household finances if you can't work for a while. Taking out life insurance means that if you pass away, your loved ones could be financially looked after with your home loan repaid and other expenses taken care of.
It would also be worth getting contents insurance to cover your things if they get stolen or accidentally damaged. Getting insurance when you're on the move can also be good idea as your belongings can sometimes get damaged in transit.
Your lawyer will work with your bank and the seller’s lawyer get all the paperwork in order. The legal work they do to transfer the property to your name is called conveyancing. It can be done by a lawyer or a conveyancer.
This is the day the money you’ve saved hard for comes out of your bank account and your new home officially becomes yours.
As part of the settlement process, your lawyer will check that the rates and utilities on the property are paid up and will prepare a settlement statement, which they’ll send to your bank. Your loan will then be drawn down and the money transferred to the seller’s bank account.
Once the vendor confirms they’ve received the money, your lawyer will complete the registration of the property’s title into your name and you’ll be able to pick up the keys.
Usually things run smoothly and by the end of settlement day you’ll be happily toasting your future in your new home. But occasionally there’s a hitch in the process, or the seller might be disorganised and late moving. For this reason, it’s a good idea to arrange your move for the day after settlement, so you don’t have a full moving van sitting around that you can’t unload.
If there’s a glitch in the process and for some reason your money doesn’t arrive in the vendor’s account by a set time, settlement could be delayed. This means you might have to pay a penalty – if so, this will be written into the sales and purchase agreement between you and the vendor, so make sure you’re aware of any deadlines.
You won’t legally own the property until settlement is complete, so you won’t be able to move if settlement is delayed.
Once settlement is complete and you have your house key in your hot little hand, you can move in. There’s a lot to think about, so here’s a checklist to use as a starting point:
Now you’ve moved into your new home, it’s time to start paying it off. We’ll let you know when your first repayment is due. It’s a good idea to try and set up repayments to go out the day after pay day to make sure you have enough money in your account.
Standard terms and conditions
The calculators should be treated as a guide only. They don't take into account all of your individual circumstances and are not financial advice.
Displayed interest rates subject to change. Kiwibank’s lending criteria, terms and conditions and fees apply.