#howtomakeanoffer Part Four: What do I pay for a deposit?
If you offer has been accepted (Awesome!) and you have gone unconditional (you have met all of the conditions on your sale and purchase agreement) you will be required to pay a deposit. The deposit is part of the sale and purchase agreement that you signed at the start -and that is what you are bound to. So how do you know what to pay?
It is up to you how much deposit you put down, but this can also influence your offer being accepted. Sometimes the deposit can be 10%, or another figure mutually agreed. If you are a first home buyer you’ll want to think about what you can actually pay upfront. If you are using the Kiwisaver first home withdrawal, sometimes your lawyer will be able to get this out early so that you can use this for your deposit, but you won’t have the home start grant until settlement date.
Some banks (not all) will allow you to get a temporary overdraft to pay the deposit – keep in mind that this will cost you 20% interest, so if you have a long settlement date, you’ll have to factor that in. The lower your deposit, the less interest you would have to pay on a temporary overdraft.
That’s it! The final tip on how to make an offer. If your planning to make an offer, don’t forget to consult your dream team.