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Mortgages

Mortgage Rates Daily Commentary
Monday 8 March 2021  Add your comment
Time to lock in long term rates?; Kainga Ora rate cuts

Record low mortgage rates will remain in place for much of this year, but some borrowers could be better off locking in long term loans, say ASB economists: [READ ON]

Kainga Ora rates fall this morning. One year rates are available at 2.67%, while two years are available at 2.97%.

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Hysteria over commission cuts

ANZ’s decisions to cut commissions paid to brokers is causing “mass hysteria” according to Approved Mortgage Brokers and NZ Mortgage Finance general manager Dave Shatford.

Tuesday, April 24th 2007, 10:55AM
Since news broke last week that ANZ was intending to cut upfront commissions by 45 basis points, Shatford’s phone and email have been running hot with comments from brokers.

His view of the change is that banks are protecting their market position. He says banks are happy for mortgage brokers to have 30% market share of all loans written, but they are uncomfortable with the current levels which are approaching 40%.

He says banks have a lot of cost sunk in their branch networks and need to generate the business directly to cover costs.

Shatford doesn’t believe the banks’ arguments that the moves are being made because of margin squeeze. His research shows that the margin between rates and the swap rate has remained reasonably constant over recent years.

Added to that banks have trimmed trail commissions paid to brokers which, he says, must helps bank margins.

The question is what are brokers going to do? Are they going to stop writing business for banks which cut margins? If they do will they stay away forever or come back later?

His view is that brokers should stop, or reduce the amount of business they write for banks that cut commission levels.

Shatford’s fear is that this won’t last for long and brokers will return to the banks. This happened when banks cut trails.

His view is that banks are predicting brokers will act in a similar way around this time.

However, brokers have plenty of other options, such as non-bank lenders, but they don’t really understand what they offer, Shatford says.

He says if they knew more about the offerings business would move to non-bank lenders and stay there.

“If (brokers) understood they will go to non-bank lenders and stay.”

What’s your view on this topic? The next issue of the NZ Mortgage Mag will cover this issue in more detail. Please email us with your feedback today at feedback@goodreturns.co.nz
« Economists divided on rate rise this weekNZ Finance secures funding line »

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Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA 4.55 2.29 2.59 2.65
ANZ 4.44 2.89 3.25 3.39
ANZ Special - 2.29 2.69 2.79
ASB Bank 4.45 2.29 2.59 2.65
Bluestone 3.49 3.34 2.99 3.34
BNZ - Classic - 2.29 2.59 2.79
BNZ - Mortgage One 5.15 - - -
BNZ - Rapid Repay 4.60 - - -
BNZ - Std, FlyBuys 4.55 2.89 3.19 3.39
BNZ - TotalMoney 4.55 - - -
CFML Loans 4.95 - - -
Lender Flt 1yr 2yr 3yr
China Construction Bank 4.49 4.70 4.80 4.95
China Construction Bank Special - 2.65 2.65 2.80
Credit Union Auckland 5.45 - - -
Credit Union Baywide 5.65 3.95 3.85 -
Credit Union South 5.65 3.95 3.85 -
First Credit Union Special 5.85 2.95 3.45 -
Heartland Bank - Online 2.50 1.99 2.35 2.45
Heretaunga Building Society 4.99 3.50 3.40 -
HSBC Premier 4.49 2.25 2.35 2.65
HSBC Premier LVR > 80% - - - -
HSBC Special - 1.99 - -
Lender Flt 1yr 2yr 3yr
ICBC 3.69 2.25 2.35 2.65
Kainga Ora 4.43 ▼2.67 ▼2.97 3.13
Kainga Ora - First Home Buyer Special - 2.25 - -
Kiwibank 3.40 3.20 3.50 3.50
Kiwibank - Offset 3.40 - - -
Kiwibank Special 3.40 2.35 2.65 2.65
Liberty 5.69 - - -
Nelson Building Society 4.95 3.20 3.24 -
Pepper Essential 4.79 - - -
Resimac 3.39 3.35 2.99 3.35
SBS Bank 4.54 2.79 2.79 3.15
Lender Flt 1yr 2yr 3yr
SBS Bank Special - 2.29 2.29 2.65
Select Home Loans 3.49 3.34 2.99 3.34
The Co-operative Bank - First Home Special - 2.09 - -
The Co-operative Bank - Owner Occ 4.40 2.29 2.59 2.79
The Co-operative Bank - Standard 4.40 2.79 3.09 3.29
TSB Bank 5.34 3.09 3.29 3.45
TSB Special 4.54 2.29 2.49 2.65
Wairarapa Building Society 4.99 3.55 3.49 -
Westpac 4.59 3.09 3.29 3.39
Westpac - Offset 4.59 - - -
Westpac Special - 2.29 2.69 2.79
Median 4.55 2.73 2.99 2.80

Last updated: 8 March 2021 8:01am

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