ANZ and Kiwibank lop mortgage rates for Chch relocations

ANZ and Kiwibank lop mortgage rates for Christchurch relocations

by Paul McBeth

June 23 (BusinessDesk) – ANZ National Bank Ltd. and state-owned Kiwibank Ltd will cut two percentage points off prevailing mortgage interest rates for up to 12 months, to help Christchurch homeowners who are forced to relocate.

ANZ National, the country’s biggest lender, has set aside $1 billion to offer the cheap mortgages, which will be set 2.04 percentage points below prevailing rates for one-year.

That would equate to a rate of around 3.7% for a 12-month loan, based on today’s interest rates, and normal rates would apply at the end of the period.

ANZ will cap the loans at $500,000 per customer, and loans must be drawn down by the end of next year.

“We estimate this offer could save someone borrowing $300,000 more than $6000, which should come as good news to them as they plan their future,” chief executive David Hisco said in a statement.

“If the whole fund is taken up this would provide a total of about $20 million in savings.”

State-owned Kiwibank Ltd. followed suit, saying it will also offer a 2 percentage point discount on its 12-month floating rate for ‘red zone’ residents who accept the government’s offer to sell their property. Kiwibank said the government’s payout will have to contribute towards the purchase price of a new property.

Prime Minister John Key and Minister responsible for the Canterbury earthquake recovery Gerry Brownlee today flagged some 5,100 homes, mainly in east Christchurch, as uneconomic to repair. The goverment will offer to buy either the property, or the land at the current rateable value. The future of another 10,500 houses is still up in the air.

Rival lender ASB Ltd. said its customers in the so-called ‘red zone’ won’t face penalty fees for repaying fixed rate mortgage early, nor break fees on using term deposits to top up purchase amounts. It will also waive an application fee for new home purchases and put $500 towards professional fees to buy a new home.

(BusinessDesk) 16:55:09

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