Unlocking Homeownership Options with Pepper Money

“Inflationary pressures continue to inflict pain, driving up the cost of living in households across New Zealand. Interest rates have soared to levels not seen in the past decade. Meanwhile, housing prices remain persistently high. To compound these difficulties, the lending criteria of traditional banks continue to be selective, leaving a growing number of borrowers in a lurch as mainstream loans can seem out of reach and out of touch.”

Surprisingly, anecdotal evidence suggests that a significant percentage of hopeful homebuyers who approach traditional banks for a home loan encounter rejection or limitations on the structure and amount they desire – between 30-40% according to some industry experts.

Smith adds, “Many individuals, upon encountering these obstacles or having been told ‘no’, rarely go on to explore alternative options – they simply stop their search altogether. Perhaps, it feels as if an early knock back may mark the end of the road for these borrowers, but banks are just one option in the world of lending.”

Echoing this sentiment on a recent Pepper Money webinar, Jeff Royle, a prominent figure in the non-bank lending sector shed light on this prevalent issue. He says the lack of awareness about non-bank lenders is an opportunity for financial advisers to educate. According to Royle, Kiwi borrowers are increasingly ‘rate obsessed’ as major banks over many years have spent an “obscene amount of money promoting their interest rates, probably to the exclusion of borrowers knowing little about other avenues for obtaining mortgages.”