Lockdown issues hit home loans

Customers unable to settle their home purchase during lockdown have been forced to re-apply for mortgages, according to advisers, as Covid restrictions impact the market.

As the 60 day period runs out for many borrowers in lockdown, and with home buyers unable to complete their purchase, advisers say they have encountered issues with lenders such as ASB.

Two advisers said the big four bank was not automatically granting extensions on previously-agreed fixed rates.

The advisers told TMM Online that ASB customers had been forced to apply for new pricing.

One broker said ASB had given their client an extra five days to settle their home purchase. However, this was not enough time, due to Auckland's extended lockdown.

Another adviser said they had been informed by ASB that loan pricing would only be honoured for 60 days from documentation. 

An ASB spokeswoman denied claims that the bank was not honouring extensions.

Across the market, at least two of the big four have gone on the record to say they will honour old pricing.

Westpac and BNZ have contacted brokers to say they will honour rates if clients cannot settle because of Covid restrictions.

Westpac said in a recent email to advisers: "We can confirm that we will continue to honour all pricing that has been agreed and rate locked if property settlements are delayed due to lockdown."

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