First non-bank lender offers six month mortgage holiday

by Ksenia Stepanova07 Apr 2020

Non-bank lender Avanti Finance has announced that it will voluntarily grant a six month mortgage holiday to its borrowers, the same option as is currently being provided by New Zealand’s main banks.

Avanti will be offering customers who have been financially impacted by COVID-19 the chance to defer or reduce their mortgage repayments for up to six months, with interest still being calculated as normal to be added to the loan after the six months is up.

This comes following an agreement between the Reserve Bank of New Zealand and all main banks to offer the payment deferral option to borrowers, though no formal agreement has yet been finalised with alternative lenders.

Avanti says the government is currently in discussion with non-banks around a similar arrangement, but it has decided to provide this option right away regardless.

“Despite not being part of the support package announced for banks, Avanti believes in doing the right thing for our mortgage customers and will extend the same assistance from today,” Avanti Finance CEO Mark Mountcastle said.

“We felt it was important to pass [the 50 basis point OCR cut] onto our existing mortgage customers,” Mountcastle added.

“We know some of our customers will be facing real financial challenges and we trust that this rate reduction along with our other COVID-19 related support will assist our customers at this time.”

Avanti Finance is also offering payment deferrals to customers with personal, vehicle or consumer loans. These payments can be deferred for up to three months, depending on individual circumstances.

“The last thing we want is for people to feel insecure in their home,” Mountcastle said.

“We’re all in this together.”

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