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The Co-operative Bank joins Government scheme

Hon Dr Nick Smith
Minister of Housing

17 April 2014

The Co-operative Bank joins Government scheme

Housing Minister Dr Nick Smith today welcomed The Co-operative Bank into the Government’s Welcome Home Loans scheme, bringing the total number of lenders offering the first home loan product to 11.

“The Co-operative Bank’s decision to offer Welcome Home Loans means that more first home buyers will have access to the scheme, and more will be able to realise the Kiwi dream of owning their own home,” Dr Smith says.

Welcome Home Loans are administered by the Housing New Zealand Corporation (HNZC). They allow for those eligible to have only a 10 per cent deposit to put towards the purchase of their first home, with HNZC underwriting the value of these loans. To be eligible, a borrower’s annual income must be $80,000 or less before tax (for one borrower), or $120,000 (for two or more borrowers). Price caps also apply on the houses being purchased and these vary across regions to reflect differing housing markets.

“There has been heightened interest in the scheme since the introduction of the Reserve Bank’s loan-to-value ratio (LVR) limits, and the Government’s expansion of the scheme last year increased the income and house price caps to make Welcome Home Loans more accessible,” Dr Smith says.

“HNZC has approved 1091 loans so far this financial year – 250 more than the number of loans approved in the entire 12 months prior to that. This significant growth can be taken as an encouraging sign that the Government’s efforts are helping those New Zealanders who may otherwise not be in a position to purchase their own home.”

The Co-operative Bank joins 10 other lenders that are already part of the scheme:
• Kiwibank
• Westpac
• TSB
• SBS
• Heartland
• Nelson Building Society
• Baywide Credit Union
• First Credit Union
• Credit Union South
• Fletcher Challenge Employees Credit Union

“I am encouraging other banks to also join the scheme. I want as many New Zealanders as possible to have access to this Government assistance to buy their first home,” Dr Smith concluded.

ENDS

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