Frequently Asked Questions

General

  • We allow clients to borrow up to 10% of their house value for approved new builds. We charge 1% interest, per annum on that loan over a 30-year term. Our clients save thousands of dollars every year by not having to pay standard market interest rates for that loan amount which a traditional bank would charge.

    A pre-approval letter is offered by Pro Fund Me so clients can effectively use their 10% loan to ‘top up’ their own cash deposit when approaching main lenders for a mortgage. They do not have to borrow as much from the bank to meet the purchase price, and can qualify for more favourable lending conditions by having more equity on paper.

  • Currently 10% of the home’s value. 

  • We can offer these 10% house value loans thanks to the generosity of our build partners at The Building Collective and building material partners. When they build a new home and sell it (say for $850,000), they donate 10% of their profits margin ($85,000) for Pro Fund Me to then loan out to the buyer. We call it a ‘delayed profit return’ model for the sake of boosting housing affordability.

  • Pro Fund Me doesn’t have branches or other high costs. Instead, our cost structure is low and our business is agile. We are not a profit-driven business so the 1% charged in interest covers the cost of management plus a small buffer to stay consistent in our rate offer.

  • Our loans are what’s legally known as a loan protected by a caveat This sits behind a main bank or senior lender’s first mortgage over the property. This structure provides additional security for the lender and reduces the risk for borrowers. A caveat loan is the least aggressive in terms of repercussions. We can’t force a mortgagee sale, but our interest in the property is recorded on the title using a caveat.

    If you change your main lender during the 30-year term, your Pro Fund Me loan stays in place, ensuring stability and continuity. If you sell your home, our loan will need to be repaid. Ask your lawyer or mortgage broker for more information about caveat loans. 

  • Periodic principal and interest repayments can be organised either monthly, fortnightly or weekly to fit in with your usual mortgage repayment schedule from your main bank.

    Pro Fund Me has a service arrangement with Neo Prime Limited. They will be managing and collecting the repayments on our behalf. Neo Prime has an online platform that will be available to check your balance and check upcoming payments.

  • The interest rate is 1% per annum fixed for 5 years, but you can repay without penalty. This gives you the flexibility to repay the loan faster if you choose (although since we are the lowest cost loan, we suggest you pay off your more expensive mortgage from the bank first!).

    Rate fluctuations are highly unlikely as there’s no cost to Pro Fund Me to borrow funds, just administration and management costs.

  • We welcome everyone from first home buyers to investors, no matter how many properties you already own.

    We abide by the Credit Contracts and Consumer Finance Act 2003 (CCCFA) and responsible lending practices, but generally speaking, our lending criteria is more flexible than traditional banks. This makes it easier for people to get a Pro Fund Me loan to top up their own cash deposit which then makes their mortgage application more attractive.

    If you are purchasing outside of a personal entity (i.e. a business or trust) then a guarantee may be needed from the directors, trustees, or another person for your Pro Fund Me loan.

  • No. Pro Fund Me is only available for new homes constructed byThe Building Collective. This is because our model depends on the willingness of developers and builders to accept a delay in receiving their profits from building the house in the first place.

    The Building Collective currently has homes for sale in Otahuhu, Mount Roskill Te Kauwhata, with plans to build thousands more right across New Zealand in years to come. These homes are priced from $699,000, making them affordable for everyone. Independent valuations are sought to determine the sales price, so homes are not over-inflated and buyers can have full confidence they are getting a fair deal.

  • No. Our loans are only available via approved mortgage brokers. These brokers are all independent (i.e. they do not work directly for Pro Fund Me) but they have been officially onboarded and understand how our business model works.

    We currently have 100 mortgage brokers from Vega Group and 250 mortgage brokers from Newpark Financial Services who are registered with us. We will be adding more brokerages as we grow. To connect with one of our approved brokers, buyers must first register on our website (www.profundme.nz).

  • Pro Fund me is a white label for Neo Prime Limited who is a registered under FSP1005781. Further information can be found at www.neo.nz

The customer

  • Nope. We want to build as many houses as possible to increase NZ’s supply.

    There are NO:

    • income caps

    • deposit maximums

    • number of property's owned caps

  • If you can gain an approval for the remaining purchase of a home, then its likely we will also approve your PFM loan. We are still bound by industry regulations and good lending practices.

  • If purchasing outside of a personal entity (business or trust) then a guarantee is taken from the directors or trustees.

After I buy

  • If you were to sell the home in the future, the PFM loan will need to be repaid, just like your main back mortgage (lose or transferred to the new owner/entity). As a caveat loan, the repayment option is triggered at a change of ownership.

  • If during the 30 years you change your main lending to a different bank, all you need to do is include the remaining balance details of your PFM loan on the new banks application. Since we are against the title, if you own the home, the PFM loan stays in place.

  • PFM and Waka Haumi Group Limited have a service arrangement with Neo Prime Limited. They will be managing and collecting the repayments on our behalf.

  • Yes, Neo Prime has an online platform that will be available to check your balance and check upcoming payments.

  • Your first repayment will be after your loan has drawn down and you have settled on your new home. It will be in line with the repayment schedule and amount in your agreement.

  • Under our contract, we agree to a 30-year term. Unless there is a default in the re-payments, we won't recall the loan. We are bound by the same contract rules.