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Brake comes off high-LVR lending

Things are looking up for borrowers with small deposits, as mainstream banks indicate they are getting back into the market.

Friday, January 10th 2014, 12:00AM

by Susan Edmunds

The banks pulled back sharply on low-equity lending before Christmas. Less than 6% of new loans in November were to borrowers with a deposit of less than 20%.

Since October, banks have been able to lend no more than one in 10 of their new loans to borrowers with a small deposit.

David Windler, of the Mortgage Supply Co, said banks had stopped almost all sub-20% lending at the end of last year. “They had so much in the pipeline that they had to.”

But he said it had started to look like banks were getting to grips with the new rules and were relaxing their criteria.

ASB had been in touch with several brokers to let them know that $40 million had been made available for lending above 80%, he said.

But the loans had to be documented by the end of January and drawn down within 60 days after that. There had to be a sale and purchase agreement already signed.

Windler said he took that to mean that ASB was confident it could meet the Reserve Bank’s criteria over the next three months.

“They’ve kept it quiet and have only talked to select brokers, and they’re not putting anything in writing,” he said.

Westpac and ANZ had also indicated they were willing to look at borrowers who had less than 20%.

Windler said demand had quietened substantially because people thought it was not worth even inquiring.

“But people have to pick up the phone and make inquiries. There are so many ways it can be done now, through Welcome Home Loans, by building, using non-bank lenders or by being a strong borrower.”

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Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
ANZ 5.19 4.15 4.09 4.49
ANZ Special - 3.65 3.59 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 ▼3.54 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 3.99
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 3.59 3.99
Median 5.35 4.15 4.09 4.19

Last updated: 16 September 2019 10:03am

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