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Borrowers need to look to the smaller lenders
22 February 2017 FOR IMMEDIATE RELEASE
BORROWERS NEED TO LOOK TO THE SMALLER LENDERS
Smaller and highly responsive New Zealand-owned and operated lenders are the go-to options for Kiwi homebuyers now more than ever as the big four trading banks become increasingly picky on mortgage lending.
“With interest rates at historic lows and swap rates increasing, the big trading banks are now seeking to claw back margin to make up for an extended period of reduced returns on assets,” said Mike Pero Mortgages chief executive Mark Collins.
“What we are seeing is that the big trading banks are limiting their lending options and are moving away from lending at the edges. What this means is it’s not taking much for borrowers to be turned away. In fact, the big banks are looking at borrowers very differently to how they did only six months ago.
“On the other hand, the smaller Kiwi-run lenders are still very good options for those looking for their first home or a good deal,” he said.
Mr Collins said borrowers with floating rate mortgages could expect to see interest rates rise in 2017.
“While we haven’t seen much movement in the official cash rate, the big trading banks have already increased floating rates in order to recapture lost margin, which will put pressure on borrower’s back pockets.
“People should be aware their mortgage repayments may rise, but the key is not to panic. Being more open to going to the smaller Kiwi-run lenders is one viable option. More than ever, that means seeking trusted advice about accessing a wider range of lenders,” he said.
-ENDS-
About Mike Pero Mortgages
Since 1990, Mike Pero Mortgages has been living and breathing the world of finance in New Zealand. Mike Pero Mortgages covers every city, suburb and town – from the top of the North Island to the bottom of the South. Mike Pero Advisers process in excess of $1 billion in loans for Kiwis each year and have helped hundreds of thousands of home owners and investors achieve their financial goals.
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