Heartland Bank has launched a new revolving credit home loan with a rate of 2.75% p.a. – 0.70% lower than the next lowest rate, and significantly lower than the average rates offered by the main banks.
Heartland’s Revolving Credit Home Loan is designed to give its customers flexible access to funds when needed, and they owe interest only on the portion of the funds that is drawn down. Heartland is not charging monthly fees for the loan, and customers can apply directly online.
Heartland Bank CEO Chris Flood said the new loan can work alongside an existing mortgage, and the digital process means customers can get approved within minutes.
Read more: Heartland Bank reports increase in reverse mortgage enquiries
“The revolving credit home loan is like an overdraft secured against the property which provides customers with flexible access to funds for whichever expenses they need,” Flood said.
“It can also work in conjunction with a standard home loan – customers can choose the loan type they’d like to apply for, whether fixed, floating, revolving credit or a combination of all three.”
“Some or all of the revolving credit limit can be used to pay for a portion of the purchase or refinance, or can be added on top of the term loan,” he explained. “The account limit stays the same, you can borrow up to that limit at any time, and are only charged interest on the funds you use.”
Heartland Bank specialises in reverse mortgages, and Flood said that demand has increased substantially over the past year as living expenses have risen.
“We have experienced a strong increase in demand, with enquiry levels in the quarter to March 31, 2021, up nearly 40% on the same time last year,” Flood said.
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“The buoyant housing market and increased cost of living for retirees are both factors which are resulting in more people looking for alternative ways to fund the retirement they want. For more and more Kiwis, a reverse mortgage is proving to be a great solution to stay in their home and live a more comfortable retirement.”
Heartland Bank’s new home loan is available to customers who are refinancing or purchasing a standalone home on a single section in an urban New Zealand centre, have equity of at least 20%, and intend to live in the home.