COVID-19 and mortgages
Apr 14, 2020
There is a six-month mortgage holiday scheme offered for people who have had their income affected as a result of COVID-19. This is for residential mortgages. Mortgage repayment deferrals mean you will not make principal and interest payments on your loan for up to 6 months. Interest is still charged and added to the loan. This means that at the end of the 6 months, the loan balance will increase, and you will likely pay more interest overall. Afterwards the repayments will be higher or the loan term is extended. An alternative is to make interest-only repayments. This reduces your outgoings at the moment and the advantage is the balance of your mortgage will still be the same as it is today at the end of the interest-only period. If you feel you may have difficulty with loan repayments during this uncertain period, please contact us to discuss the best option for your situation. Key details of the scheme can be found here: https://covid19.govt.nz/government-actions/financial-support/
We’ve had enquiries as to whether you can still get a mortgage during lockdown. The answer is yes. The banks and lenders are still operating and we can assist with new applications or changes to existing loans. Interest rates have come down to record lows following the Reserve Bank dropping the official cash rate to an all-time low of 0.25%. You might be considering accessing some equity in your home, obtaining a personal loan or consolidating your debts to free up extra cashflow. In which case, please get in touch so we can advise you.