Non-bank lender Resimac has revealed that it was able to maintain stable business levels amid the COVID-19 pandemic and the New Zealand lockdown, with a 30% increase in inquiry levels since Easter.
Luke Jackson, head of New Zealand at Resimac, said two factors helped the market handle the alert level 4 lockdown restrictions.
“We are hearing from our mortgage adviser network that banks are not focusing on new business and are preoccupied with processing COVID-19 hardship applications. As a result, more borrowers and advisers are turning to non-banks,” Jackson explained.
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Jackson said they have been receiving more applications for refinancing and from customers who confirmed that they would purchase a property only to have their lender reject their pre-approvals.
“This is happening against the longer-term backdrop of non-bank lenders taking market share away from banks. Non-banks are now providing interest rates that match bank rates. For example, Resimac recently launched a 3.49%pa variable mortgage rate and a two-year fixed rate of 3.39%pa,” he said.
He claimed that customers now see non-banks as a real alternative to trading banks as banks seem to have stopped offering “cashbacks.”
“I expect in the coming months the non-bank share of the mortgage market will continue to grow as more advisers and borrowers recognise the attractiveness of non-bank lending solutions,” Jackson concluded.