Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Be clear how much you’ll pocket if selling property

Media release – 27 August 2014

Be clear how much you’ll pocket if selling one of your properties

Customers wanting to sell one of their properties to release capital should first be clear how much money their bank will let them pocket, said Banking Ombudsman Deborah Battell.

Following complaints from people who found their bank didn’t let them keep what they expected to clear from the sale of one of their properties, the Banking Ombudsman Scheme has issued a quick guide on selling property to release capital.

The Banking Ombudsman receives complaints for a variety of factors, including early repayment costs and legal fees, but particular problems arise when people own two or more properties that secure one or more loans.

“If a customer sells a property which is security for a loan, they usually keep the proceeds after the loan is repaid. However, this may not necessarily be the case when a person has an “all-obligations” mortgage and a number of loans.

“The bank must be satisfied it is left with sufficient security for its remaining property and other loans. This sometimes means the amount owing on remaining loans needs to be reduced with proceeds from the property sale, and this has been a nasty surprise for some customers,” Ms Battell said.

For example, the bank can require customers to pay off other debt rather than keep the money if:

• their financial situation has changed, affecting their ability to make loan repayments

• property values have dropped, as happened in the global financial crisis

• the bank’s lending criteria has changed since the loans were obtained, and the lending may no longer meet the bank's loan-to-value ratio (LVR) requirements.

The Banking Ombudsman Scheme has a range of property-related quick guides including:

Early repayment costs on fixed rate loans

Concerns about lending decisions

Residential loan-to-value lending restrictions

ends


© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop Business: NZ Wool Exports Jump To The Highest In More Than A Decade

New Zealand wool exports jumped to their highest level in more than a decade in June, aided by a lower currency and strong demand from China, the nation’s largest market. More>>

ALSO:

Surreal Estate: Home Values Rise At Fastest Rate In Seven Years

The latest monthly QV House Price Index shows that nationwide residential property values for July have increased 10.1% over the past year which is the fastest annual rate since 2007... The Auckland market has increased 18.8% year on year. More>>

ALSO:

New Employment Laws: Talley’s AFFCO Workers To Strike

The decision comes after the Talley’s owned company walked away from mediation last week and applied to end bargaining under the government’s new employment laws - the first such application since the law came into effect. More>>

ALSO:

Private Action: Employer Pleads Guilty Over Forestry Death

The CTU has always known that the death of forestry worker Charles Finlay was due to the poor health and safety practices of his employer... "The CTU, with the support of Charles’s family, needed to take this ground breaking private prosecution." More>>

ICT Innovation: Six NZ Finalists In World Summit Awards

The awards are a global showcase of 40 projects, across eight categories, with a special emphasis on those which show the benefits of information and communication technology for the development of communities. New Zealand has finalists in six of the eight categories. More>>

ALSO:

Final Frontier: Rocket Lab And NASA Sign Commercial Space Launch Agreement

Rocket Lab has signed a Commercial Space Launch Act Agreement with the National Aeronautics and Space Administration (NASA). The agreement enables Rocket Lab to use NASA resources - including personnel, facilities and equipment - for launch and reentry efforts. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news