Banks offer special low rates to red zone borrowers

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[UPDATED - includes BNZ and Westpac] ASB, Kiwibank and ANZ National have all announced special offers for Christchurch customers with rates as low as 3.65% and ANZ saying it has $1 billion available to lend.

Friday, June 24th 2011, 9:30AM 3 Comments

ASB chief executive Barbara Chapman says the bank's $250 million support package announced after the February quake has been well received it will continue to assist them wherever possible.

ASB customers living in the red zones who choose to settle up their mortgages and look to relocate will be supported by ASB, she says.

 We've put in place new support measures targeting their unique and difficult circumstances." 

For these ASB customers the following assistance will now be available:

• no early repayment adjustments if fixed rate mortgages are repaid;
• zero application fee for new home purchases;
• $500 towards professional fees related to the purchase; and
• no break fees on term deposits used to top up purchase amounts. 

"We'll be working with the Government, insurers and our customers over the coming weeks and months as the details of the Government's plans become clearer.

Kiwibank
Kiwibank has announced a special home loan package for people affected by the earthquakes in Christchurch and eligible for the Government's red zone assistance.

The bank will provide mortgage lending at a 2% discount on its floating rate (presently 5.65%) for a year from draw down.

The loan package is available for those who accept the offer from the Government and wish to purchase or build a property elsewhere. They will be required to contribute the Government's payout towards the property purchase price.

ANZ National
ANZ New Zealand says it has committed $1 billion in new residential mortgage lending and has introduced a special low interest rate for one year to help Christchurch residents relocate from the residential red zones where the Government has made an offer to purchase.

ANZ New Zealand chief executive Hisco the offer "demonstrates ANZ's commitment to supporting Christchurch people for the long-haul."

"We estimate this offer could save someone borrowing $300,000 more than $6,000, which should come as good news to them as they plan their future."

"If the whole fund is taken up this would provide a total of about $20 million in savings, adding to the assistance ANZ New Zealand is already providing to Christchurch," Mr Hisco said.

ANZ's Christchurch Mortgage Package

• Low variable mortgage interest rate (currently 3.70%) pegged for one year at 2.04% below ANZ's and The National Bank's variable mortgage rate. After one year, the normal variable rate applies. The package is available directly through the ANZ and National Bank.
• Open to customers of any bank, including ANZ and The National Bank, who own a residential property in the residential red zones where a Government offer has been made for purchase, whether they decide to stay in Christchurch or to relocate.
• Loan capped at $500,000 per customer to ensure as many Christchurch residents who wish to relocate have access to the $1 billion fund.  Additional lending available on normal terms.
• Applies to residential mortgage lending and is subject to normal lending criteria.
• Participating customers need to deposit the net proceeds of their Government payout into an ANZ or National Bank account within two months of receipt, and must have their salary direct credited to an ANZ or National Bank account.
• Loans must be drawn down by 31 December 2012.

"Although we have earmarked $1 billion for this package, the situation is unprecedented and we don't know how large the take-up will be," Hisco says.

BNZ
BNZ has announced a brand new Resilience Package for home owners in the red zone following the government's land zoning announcement.

The package includes a 2% interest bonus on deposits and a 2% discount on variable mortgage rates for all property owners in the newly designated red zone.


"We recognise that impacted homeowners have a wide range of financial needs with payouts from the Government Land Package coupled with insurance payouts and the decision to purchase or build a new home, BNZ's new Resilience Package will work to give them additional support and we hope a welcome breather," BNZ chief executive Andrew Thorburn says,

BNZ has already extended around $20 mill in hardship assistance to more than 1,400 businesses and home owners impacted by the earthquake and has allocated an additional $1 billion of new funding to assist and to provide investment and funding support

Summary of Offer:
•The offer is available to all owners of residential property inside the Red Zone, who are eligible for and take up the Crown Red Zone assistance packages. Both offers can not be taken simultaneously.
•The deposit rate will be available until 30 June 2012.  The rate will be 2% above BNZ's top-tier TotalMoney deposit rate.  Currently this equates to a 5% deposit rate.  
•The discounted mortgage rate will be based on a 2% discount on BNZ's TotalMoney home loan variable rate.  This current equates to a rate of 3.59%.  This must be drawn down by 30th June 2012, and will be available for a term of 12 months.
•Each of the deposit and home loan amounts are limited to $500,000.

Westpac

Westpac is offering a variable rate of 3.65% for Christchurch residents in the Government’s residential red zone. The new rate is open for those residents who qualify and take up the Government’s offer to sell their property. Home loan amounts are limited to $500,000. The offer is available until December 2012 and is available for a term of 12 months. Break fees for red zone residents will also be waived.

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