What types of house loans are available in New Zealand?
New Zealand homebuyers have more home loan options than most realise. Here is a clear snapshot of the main mortgage types you will encounter:
- Table loan: The standard structure, with equal repayments over 25–30 years. Early payments are mostly interest, shifting toward principal over time.
- First Home Loan: Backed by Kāinga Ora, this lets eligible buyers purchase with just a 5% deposit instead of the usual 20%, subject to income caps.
- Fixed-rate loan: Your interest rate is locked for a set term, giving you predictable repayments.
- Floating (variable) rate loan: The rate moves with market conditions, offering flexibility but less certainty on repayment amounts.
- Interest-only loan: You repay only interest for an initial period, keeping payments lower but not reducing your principal balance.
- Offset/revolving credit loan: Links your savings to your loan balance so you pay interest on a reduced amount.
- Equity loan (second mortgage): Borrows against the equity you have built in your home, often used for renovations or investment.
Most lenders require a 20% deposit under standard LVR rules, though government-backed schemes change that equation for qualifying buyers.
Table of Contents
- How do different mortgage types actually work?
- Government-backed schemes beyond the First Home Loan
- Mortgagemanagers makes finding the right loan straightforward
- Key takeaways
How do different mortgage types actually work?
Table loans
The table loan is New Zealand’s most common mortgage structure. Your repayment stays the same each fortnight or month across a long-term period, but the split between interest and principal shifts gradually. In the early years, the bulk of each payment covers interest. By the final years, you are paying down mostly principal.
Fixed vs floating rates
About 88% of NZ mortgages were on fixed rates as of late 2025, and it is easy to see why. Fixed rates give you certainty: you know exactly what you owe each month, regardless of Reserve Bank movements. Floating rates, by contrast, can rise or fall at any time, which suits borrowers who want the freedom to make lump-sum repayments without penalty.
Pro Tip: Split your loan: fix 70–80% for budgeting certainty and keep 20–30% floating. That way, if you receive a bonus or inheritance, you can pay down the floating portion without break fees. See fixed vs floating explained for a deeper comparison.
First Home Loans and eligibility
The Kāinga Ora First Home Loan is designed for buyers who can service a mortgage but struggle to save a full deposit. Income caps apply. A Lender’s Mortgage Insurance fee is added to the loan balance in place of the standard deposit shortfall risk.
Interest-only and offset loans
Interest-only loans suit property investors or buyers in a short-term cash-flow squeeze. Because you are not reducing principal, the total interest paid over the life of the loan is higher. Offset loans work differently: your savings balance is subtracted from your loan balance before interest is calculated, so your interest is payable only on a reduced loan amount.
Loan fees to factor in
Beyond the interest rate, standard loan costs include establishment fees, valuation fees, and Lender’s Mortgage Insurance where your deposit falls below 20%. These add up, so comparing the full cost of each option matters as much as the headline rate.
Government-backed schemes beyond the First Home Loan
Kāinga Ora’s First Home Loan gets most of the attention, but it is not the only government-backed pathway. The Kāinga Whenua Loan supports Māori buyers looking to build, purchase, or relocate a home on Māori land with shared ownership, including land trusts and Māori collectives. The First Home Partner scheme allows Kāinga Ora to make a financial contribution toward a purchase and share ownership with the buyer, reducing the amount you need to borrow outright. Both programmes sit alongside the First Home Loan as part of a broader suite of first-time buyer support that the New Zealand Government has built to widen access to homeownership.
Mortgagemanagers makes finding the right loan straightforward
Knowing the different mortgage types is one thing. Knowing which one fits your income, deposit, and goals is where a local adviser earns their keep.
Mortgagemanagers is a locally owned Auckland brokerage, led by adviser Stuart, that works across West Auckland, the North Shore, Hobsonville, and remotely throughout New Zealand. Rather than sending you to one bank and hoping for the best, the team compares options across multiple lenders to find the structure that genuinely suits your situation, whether that is a First Home Loan with Kāinga Ora support, a split fixed/floating arrangement, or a non-standard loan for a more complex application. There are no upfront fees for the advice: Mortgagemanagers earns a commission from the lender on settlement.
Ready to work out which loan type fits you? Talk to the Mortgagemanagers team and get personalised guidance from advisers who know the New Zealand market inside out.
Key takeaways
New Zealand’s most practical mortgage choice for most buyers remains the table loan, but government-backed schemes and rate-splitting strategies can significantly reduce your upfront costs and long-term interest burden.
| Point | Details |
|---|---|
| Table loan is the standard | Equal repayments over 25–30 years, shifting from interest-heavy to principal-heavy over time. |
| About 88% of NZ mortgages were fixed-rate loans as of late 2025, with fixed terms offering repayment certainty against rate movements. | Fixed terms offer repayment certainty against rate movements. |
| First Home Loan cuts deposit to 5% | Kāinga Ora underwrites the loan; income caps apply for eligibility. |
| LMI applies below 20% deposit | A Lender’s Mortgage Insurance fee is added to the loan balance when the deposit falls below 20%. |
| Mortgagemanagers | Stuart’s locally owned Auckland team compares lenders to match you with the right loan structure. |