Mortgages

Banks get cautious with home lending

Banks are tightening their lending criteria as the housing boom cools, over-heated property valuations fall and interest rates continue to rise.

Monday, June 21st 2004

Where banks once lent up to 80 per cent of the value of inner-city apartments, they are now often prepared to lend no more than 50 per cent of the value.

Banks are also taking a more cautious approach to lending on high-value coastal properties and on homes in places where boom conditions have bordered on bust.

Kiwibank chief executive Sam Knowles said Nelson, Wanaka and Queenstown were examples of locations where banks were taking a hard look at loan applications. Tighter loan criteria were decided case by case and could vary widely.

But the uniformly big change in banks' willingness to loan on the apartment market "only recognises the risks in this sector", he said.

Knowles said banks were now particularly cautious about apartment developments. But it was unlikely banks would revise lending criteria allowing homeowners to borrow up to 100 per cent of the value of the property in certain circumstances.

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Heartland Bank - Online 6.69
SBS FirstHome Combo 6.74
Wairarapa Building Society 6.95
Unity 6.99
Co-operative Bank - First Home Special 7.04
ICBC 7.05
China Construction Bank 7.09
BNZ - Classic 7.24
ASB Bank 7.24
ANZ Special 7.24
TSB Special 7.24
Unity First Home Buyer special 6.45
Heartland Bank - Online 6.45
China Construction Bank 6.75
TSB Special 6.75
ICBC 6.75
ANZ Special 6.79
ASB Bank 6.79
AIA - Go Home Loans 6.79
Kiwibank Special 6.79
BNZ - Classic 6.79
Unity 6.79
Westpac Special 6.39
China Construction Bank 6.40
ICBC 6.49
SBS Bank Special 6.55
Kiwibank Special 6.55
BNZ - Classic 6.55
Co-operative Bank - Owner Occ 6.55
ASB Bank 6.55
AIA - Go Home Loans 6.55
TSB Special 6.59
Kainga Ora 6.99
SBS FirstHome Combo 6.19
AIA - Back My Build 6.19
ANZ Blueprint to Build 7.39
Credit Union Auckland 7.70
ICBC 7.85
Heartland Bank - Online 7.99
Pepper Money Essential 8.29
Co-operative Bank - Owner Occ 8.40
Co-operative Bank - Standard 8.40
First Credit Union Standard 8.50
Kiwibank 8.50

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