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Last Article Uploaded: Monday, September 23rd, 8:58PM
Mortgage Rates Daily Commentary
Monday 23 September 2019  Add your comment
Westpac and BNZ rate cuts; NZ bank risk assessed

To kick off the week, both BNZ and Westpac have cut fixed mortgage rates this morning.

BNZ's two-year rate has fallen to 3.49% for owner-occupiers, and 3.74% for investors.

Meanwhile, Westpac's two-year fixed special is down to 3.54%, a 5 basis point cut.

See how two year rates stack up on our rates table.

Ratings agency S&P has done some more analysis on the NZ banking sector. It believes the industry is as risky here as it is in Iceland and Ireland. Find out more here: [READ ON].

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MTF case reaches Supreme Court

A long-running battle over what exactly lender credit fees should cover has hit the Supreme Court this week.

Thursday, November 12th 2015, 9:50AM

by Miriam Bell

NZXZ-listed Motor Trade Finance (MTF) and the Commerce Commission are seeking a final verdict on what can be charged for various fees under the Credit Contracts and Consumer Finance Act 2003.

The case is important as it will set a precedent and lay down the rules on lender credit fees.

MTF is appealing a Court of Appeal decision earlier this year that the fees charged by MTF were unreasonable under section 41 of the CCCFA.

The Court of Appeal upheld the findings of lower courts in its decision and found that lender credit fees should only cover costs closely related to the particular loan transaction.

MTF’s day in the Supreme Court has been a long time coming.

Its origins date back to a complaint about MTF and one of its shareholders, Sportzone Motorcycles, which was laid with the Commerce Commission back in 2006.

The complaint led to a Commerce Commission investigation into the lending practices of MTF and Sportzone.

Both companies were charged with charging unreasonable establishment fees, account maintenance fees, and arrears fees on 39 finance contracts, in breach of the CCCFA.

In 2013, a High Court ruling found the fees charged were unreasonable and in breach of the CCCFA.

Then, in 2014, the High Court released a further judgement clarifying the practices lenders should adopt when charging fees.

MTF and Sportzone appealed both decisions to the Court of Appeal which also found in favour of the Commerce Commission.

This week’s Supreme Court hearing is MTF’s last attempt at gaining a ruling in its favour.

However, Sanderson Weir director Jonathan Flaws said the Supreme Court won’t be able to do much more than tinker around the edges of the existing MTF judgements.

In his view, this will achieve nothing. 

Flaws said the High Court decision, which was upheld by the Court of Appeal, defined what is unreasonable when it comes to establishment fees and prepayment fees.

It also laid out a close and relevant test for establishment fees and set a general standard for “other fees”.

“Having the certainty of applying the methodology outlined by Justice Toogood is more constructive than trying to tweak the methodology to get an arguably better result for lenders in some areas only to find a worse result in others.”

A Commerce Commission spokesperson said they are not able to comment on the case while it is before the courts.

The Supreme Court’s hearing into the MTF case finishes today, but a decision in not expected for some time.

Tags: CFA Commission disputes fees finance companies financial advisers Responsible lending

« Housing market still a risk - RBNZMore OCR cuts to come »

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Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
ANZ 5.19 4.15 ▼4.04 4.49
ANZ Special - 3.65 ▼3.54 3.99
ASB Bank 5.20 4.15 4.09 4.39
ASB Bank Special - 3.65 3.59 3.89
BNZ - Classic - 3.65 ▼3.49 3.99
BNZ - Mortgage One 5.90 - - -
BNZ - Rapid Repay 5.35 - - -
BNZ - Std, FlyBuys 5.30 4.45 4.35 4.55
BNZ - TotalMoney 5.30 - - -
China Construction Bank 5.50 4.70 4.80 4.95
China Construction Bank Special - 3.19 3.19 3.19
Lender Flt 1yr 2yr 3yr
Credit Union Auckland 5.95 - - -
Credit Union Baywide 6.15 4.95 4.95 -
Credit Union North 6.45 - - -
Credit Union South 6.45 - - -
Finance Direct - - - -
First Credit Union 5.85 - - -
Heartland 6.70 7.00 7.25 7.85
Heartland Bank - Online - - - -
Heretaunga Building Society 5.75 4.80 4.95 -
Housing NZ Corp 5.19 ▼4.15 ▼4.09 ▼4.39
HSBC Premier 5.24 3.35 3.35 3.35
Lender Flt 1yr 2yr 3yr
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 5.65 3.85 3.95 3.89
Kiwibank 5.80 4.30 4.34 4.74
Kiwibank - Capped - - - -
Kiwibank - Offset 5.15 - - -
Kiwibank Special - 3.55 3.59 3.99
Liberty 5.69 - - -
Napier Building Society - - - -
Nelson Building Society 5.70 4.69 4.79 -
Resimac 5.30 4.86 4.14 4.19
Lender Flt 1yr 2yr 3yr
RESIMAC Special - - - -
SBS Bank 5.29 4.85 5.05 5.49
SBS Bank Special - 3.69 3.69 ▼3.89
Sovereign 5.30 4.15 4.29 4.55
Sovereign Special - 3.65 3.75 4.05
The Co-operative Bank - Owner Occ 5.15 3.65 3.59 3.99
The Co-operative Bank - Standard 5.15 4.15 4.09 4.49
TSB Bank 6.09 4.65 4.59 4.85
TSB Special 5.29 3.85 3.79 4.05
Wairarapa Building Society 5.70 4.85 4.99 -
Westpac 5.34 4.15 4.09 4.49
Lender Flt 1yr 2yr 3yr
Westpac - Offset 5.34 - - -
Westpac Special - 3.65 ▼3.54 3.99
Median 5.35 4.15 4.09 4.19

Last updated: 20 September 2019 9:30am

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