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Ombudsman sees drop in mortgage cases

A new report from the Banking Ombudsman suggests New Zealand's lenders are doing a better job selling mortgages to customers.

Thursday, July 26th 2018, 4:23PM

by Dan Dunkley

Complaints, inquiries and disputes relating to mortgage sales fell by 14% last year, according to the Banking Ombudsman Scheme’s 2018 annual report.

The report, released today, shows customer disputes over mortgage advice fell despite a wider increase in overall bank complaints.

Cases regarding loan to value ratio (LVR) disputes also fell over the year, the report shows. LVR-related cases dropped 13 percent in 2017-18, according to the Ombudsman.

Nicola Sladden, head of the Ombudsman, said the drop could be a decrease in the number of early repayment cases, as well as increased awareness of LVR restrictions. She told TMM Online: "We had a spike a couple of years ago but haven't had a continuation of those claims. The numbers also suggest New Zealanders are becoming more familiar requirements around LVR."

Disputes over mortgages made way for more unfamiliar customer gripes. Complaints about cryptocurrency Bitcoin rose by 70 percent last year. While so-called binary options traders saw a 50 percent rise in activity, according to the Ombudsman.

The fall in mortgage cases is likely to be welcomed by New Zealand’s major mortgage lenders. Yet the overall figures reveal a growing number of bank complaints.

In total, complaints, inquiries and disputes against New Zealand lenders rose by 14 percent. Banks had 3972 cases against them in total.

New Zealand’s biggest bank ANZ had the most number of complaints, making up 17 percent of the Ombudsman’s cases. ASB, BNZ, and Westpac took 12 percent, 10 percent, and 14 percent respectively.

The report will be watched closely by banks and regulators in the wake of Australia’s Royal Commission into financial services, which revealed endemic misconduct issues across the Tasman.

The Commission placed the spotlight on the relationship between banks and third parties such as mortgage advisers. Yet New Zealand regulators have stated there is “no evidence” to warrant a similar review of Kiwi banks.

Sladden said the Ombudsman supported the regulators taking a "further look at banking processes and systems" as part of ongoing safeguarding of the financial sector, but hadn't seen evidence of the "widespread systemic abuse seen in the Australian commission". 

 

Tags: ANZ bitcoin BNZ mortgages regulation Westpac

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Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
ANZ 5.79 4.55 4.79 4.99
ANZ Special - 4.05 4.29 4.49
ASB Bank 5.80 4.44 4.69 4.89
ASB Bank Special - 3.95 4.29 4.49
BNZ - Mortgage One 6.50 - - -
BNZ - Rapid Repay 5.95 - - -
BNZ - Special - 4.10 4.29 4.49
BNZ - Std, FlyBuys 5.90 4.69 4.79 4.99
BNZ - TotalMoney 5.90 - - -
Credit Union Auckland 6.70 - - -
Credit Union Baywide 6.15 5.20 5.25 -
Lender Flt 1yr 2yr 3yr
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 4.70 4.85 -
Housing NZ Corp 5.80 4.69 4.79 4.79
HSBC Premier 5.89 3.99 4.19 4.69
HSBC Premier LVR > 80% - 3.79 - -
HSBC Special - - - -
Lender Flt 1yr 2yr 3yr
ICBC 5.80 4.59 4.69 5.09
Kiwibank 5.80 4.55 4.69 4.99
Kiwibank - Capped - - - -
Kiwibank - Offset 5.80 - - -
Kiwibank Special - 4.05 4.29 4.49
Liberty 5.69 - - -
Napier Building Society - - - -
Nelson Building Society 6.10 5.10 5.45 -
Resimac 5.30 4.86 4.94 5.30
RESIMAC Special - - - -
SBS Bank 5.89 4.85 5.05 4.49
Lender Flt 1yr 2yr 3yr
SBS Bank Special - 4.19 3.95 4.49
Sovereign 5.90 4.45 4.69 4.89
Sovereign Special - 3.95 4.29 4.49
The Co-operative Bank - Owner Occ 5.75 4.10 4.35 4.49
The Co-operative Bank - Standard 5.75 4.60 4.85 4.99
TSB Bank 5.80 4.45 4.69 4.99
TSB Special - 3.95 4.19 4.49
Wairarapa Building Society 5.70 4.85 4.99 -
Westpac 5.95 4.69 4.79 5.19
Westpac - Offset 5.95 - - -
Westpac Special - 4.15 4.29 4.59
Median 5.89 4.50 4.69 4.79

Last updated: 2 December 2018 8:39pm

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