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LVR rules an opportunity for P2P

Peer-to-peer lender LendMe is expecting to a get boost as a result of the new, tighter loan-to-value restrictions on investors.

Friday, July 22nd 2016, 12:04PM

by Susan Edmunds

Landlords are now required to have 40% deposit to purchase properties. For Auckland buyers, that is an increase from 30%. It is the first time investor-specific restrictions have been in introduced for the rest of New Zealand.

But non-bank lenders, including peer-to-peer platforms and operators such as Resimac, are exempt from the rules.

LendMe is a peer-to-peer platform that specialises in loans secured by a first mortgage.

LendMe director and chief executive Marcus Morrison said the new rules were an opportunity for his organisation.

Peer-to-peer investors looking to lend money would probably think an investment in the Auckland housing market, even at 70% or 80% LVR, was a safe bet, he said.

“That’s how we look at thigns, is there investor appetite based on the risk profile? We are not governed by the same rules that banks are but we are governed by lender appetite. At the end of the day if there’s 70% LVR on an Auckland-based property, although people speculate there may at some point be a downturn I would suggest that most people’s feeling would be at 30% equity there’s enough room in there that it is unlikely to come down that far.”

Morrison said interest in peer-to-peer investment was also being buoyed by low interest rates.

It is predicted that the official cash rate will be cut again in August.

“There’s a consistent desire to find good yield,” Morrison said. “If they are only getting 2.5% or 3% on deposit at the bank but they can get 7.5% or 8% with us backed by a first mortgage, they are increasingly looking favourably at that.”

Tags: LendMe Peer to Peer Lending

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Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA 4.55 2.85 3.25 3.55
ANZ 4.44 ▲3.39 ▲3.85 ▲4.09
ANZ Blueprint to Build 1.68 - - -
ANZ Special - ▲2.79 ▲3.25 ▲3.49
ASB Back My Build 1.79 - - -
ASB Bank 4.45 2.85 3.25 3.55
Basecorp Finance 5.49 - - -
Bluestone 3.49 3.34 2.99 3.34
BNZ - Classic - 2.85 3.25 3.55
BNZ - Mortgage One 5.15 - - -
BNZ - Rapid Repay 4.60 - - -
Lender Flt 1yr 2yr 3yr
BNZ - Std, FlyBuys 4.55 3.45 3.85 4.15
BNZ - TotalMoney 4.55 - - -
CFML Loans 4.95 - - -
China Construction Bank 4.49 4.70 4.80 4.95
China Construction Bank Special - 2.65 2.65 2.80
Credit Union Auckland 5.95 - - -
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 2.25 1.85 2.35 2.65
Heretaunga Building Society 4.99 3.80 3.90 -
Lender Flt 1yr 2yr 3yr
HSBC Premier 4.49 2.19 2.45 2.69
HSBC Premier LVR > 80% - - - -
HSBC Special - 2.25 - -
ICBC 3.69 ▲2.45 ▲2.85 ▲3.15
Kainga Ora 4.43 2.88 3.28 3.59
Kainga Ora - First Home Buyer Special - 2.25 - -
Kiwibank 3.75 ▲3.80 ▲4.00 4.34
Kiwibank - Offset 3.75 - - -
Kiwibank Special 3.75 ▲2.95 ▲3.15 3.49
Liberty 5.69 - - -
Nelson Building Society 4.95 2.99 3.24 -
Lender Flt 1yr 2yr 3yr
Pepper Essential 4.79 - - -
Resimac 3.39 2.98 2.79 3.29
SBS Bank 4.54 2.99 3.39 3.59
SBS Bank Special - 2.49 2.89 3.09
Select Home Loans 3.49 3.34 2.99 3.34
The Co-operative Bank - First Home Special - ▲2.65 - -
The Co-operative Bank - Owner Occ 4.40 ▲2.85 ▲3.25 ▲3.49
The Co-operative Bank - Standard 4.40 ▲3.35 ▲3.75 ▲3.99
TSB Bank 5.34 3.35 3.75 4.05
TSB Special 4.54 2.55 2.95 3.25
Wairarapa Building Society 4.99 3.55 3.49 -
Lender Flt 1yr 2yr 3yr
Westpac 4.59 3.45 3.85 4.09
Westpac - Offset 4.59 - - -
Westpac Special - 2.85 3.25 3.49
Median 4.54 2.95 3.25 3.49

Last updated: 29 September 2021 8:51am

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