Split home loans squashed
A recent Australian High Court decision declaring that a product known as a "split loan" is illegal is having ripple effects in the New Zealand market, although similar products are still available here.
Wednesday, July 7th 2004, 6:22AM
by The Landlord
GEM Home Loans, a New Zealand company owned by the Australian company which was at the centre of the test case, has confirmed it won’t be promoting the product, known as "Wealth Optimiser," in New Zealand as a result of the court decision."I believe this is the end of the road," GEM’s New Zealand manager Keven Shaw.says of the legal process which has taken about five years.
In the wake of the decision, non-bank wholesale lender AMS has withdrawn its similar product known as "Equity Accelerator" from both the Australian and New Zealand markets.
Head of AMS New Zealand, Peter Cochrane, says his company had sold very little of the product so the decision was pretty much a non-event.
But the ANZ Bank-owned mortgage wholesale lender Origin is still providing a similar version of the product, known as "Smart Investor," and at least one lender, Pioneer Home Loans, is still promoting it
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