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Mortgages

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Huge pile of mortgage money on short terms as borrowers wait for interest rate drops; SBS and Kiwibank rates change

While mortgage lending grows most borrowers are shying away from long term fixed rates as the Reserve Bank indicates it has more OCR cutting to do. [READ ON]

 

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ASB enters home equity release market

ASB has entered into the home equity release market which was active but is currently extremely dormant.

Wednesday, August 25th 2010, 10:31PM

Several years ago there were a number of active players in the market. Sentinel was the leader, but other providers included Propertyfinance Securities, Bluestone, Dorchester, Westpac and SBS.

Sentinel is doing little lending as it waits for the securitisation market to pick up to provide funding again. Dorchester, which was funded by Kiwibank has pulled out of the market recently.

Bluestone and PropertyfinanceSecurities have disappeared, while Westpac, which offered a branded Bluestone product, exited the market several years ago.

The only provider still involved is SBS.

ASB says it is introducing its product, HomePlus, in response to demand from its senior customers.

Chief executive, Customers Markets and Products, Catherine McGrath says that in Australia home equity release loans are becoming more common.

"ASB is committed to setting the highest possible standards to ensure the protection of our customers.

"HomePlus complies with the voluntary code of practice developed by the Office of Senior Citizens. We will also set new ethical standards, particularly around ensuring borrowers fully understand the arrangement into which they are entering, providing guarantees around lifetime occupancy and promising people never have to repay more than the value of their property.

"The 90 day cooling off period also ensures borrowers who change their minds can repay their HomePlus loan.

ASB warns that home equity release is not for all senior customers. "We recommend it only for those customers who have no other means of accessing cash."

"Releasing funds from other assets if available will invariably be a better option than taking out a home equity release loan.

"However, for those who do not have other options it can allow them to maintain an independent lifestyle, stay in their own home longer, or undertake necessary repairs that are otherwise beyond their financial means.

The HomePlus interest rate is 7.75%. It is a variable rate loan and will fall and rise in line with ASB's cost of funding HomePlus loans.

 

« TSB lifts mortgage market share but profit dropsANZ mortgage market share dips »

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Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA - Back My Build 4.94 - - -
AIA - Go Home Loans 7.49 5.79 5.49 5.59
ANZ 7.39 6.39 6.19 6.19
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 5.79 5.59 5.59
ASB Bank 7.39 5.79 5.49 5.59
ASB Better Homes Top Up - - - 1.00
Avanti Finance 7.90 - - -
Basecorp Finance ▼8.35 - - -
BNZ - Classic - 5.99 5.69 5.69
Lender Flt 1yr 2yr 3yr
BNZ - Mortgage One 7.54 - - -
BNZ - Rapid Repay 7.54 - - -
BNZ - Std 7.44 ▼5.79 ▼5.59 5.69
BNZ - TotalMoney 7.54 - - -
CFML 321 Loans 6.20 - - -
CFML Home Loans 6.45 - - -
CFML Prime Loans 8.25 - - -
CFML Standard Loans 9.20 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - 5.69 - -
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Owner Occ 6.95 5.79 5.59 5.69
Co-operative Bank - Standard 6.95 6.29 6.09 6.19
Credit Union Auckland 7.70 - - -
First Credit Union Special - 5.99 5.89 -
First Credit Union Standard ▼7.69 6.69 6.39 -
Heartland Bank - Online 6.99 ▼5.49 ▼5.39 ▼5.45
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.60 6.65 6.40 -
ICBC 7.49 5.79 5.59 5.59
Kainga Ora 8.39 7.05 6.59 6.49
Kainga Ora - First Home Buyer Special - - - -
Lender Flt 1yr 2yr 3yr
Kiwibank 7.25 ▼6.69 ▼6.49 6.49
Kiwibank - Offset 7.25 - - -
Kiwibank Special 7.25 ▼5.79 ▼5.59 5.69
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 7.94 ▼5.75 ▼5.99 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
SBS Bank 7.49 6.95 6.29 6.29
SBS Bank Special - ▼5.89 ▼5.49 5.69
SBS Construction lending for FHB - - - -
Lender Flt 1yr 2yr 3yr
SBS FirstHome Combo 4.94 ▼4.89 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.75 - - -
TSB Bank 8.19 6.49 ▼6.39 ▼6.39
TSB Special 7.39 5.69 ▼5.59 ▼5.59
Unity 7.64 ▼5.79 ▼5.55 -
Unity First Home Buyer special - 5.49 - -
Wairarapa Building Society ▼7.70 ▼5.95 ▼5.75 -
Westpac 7.39 6.39 6.09 6.19
Westpac Choices Everyday 7.49 - - -
Westpac Offset 7.39 - - -
Lender Flt 1yr 2yr 3yr
Westpac Special - 5.79 5.49 5.59
Median 7.49 5.84 5.75 5.69

Last updated: 9 December 2024 10:05am

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