new home loans

PHOTO: NZ Banks starting to get competitive in a shrinking mortgage market. (file image) (Source: istock.com)

Kiwibank is offering home buyers 1% of their new home loan as a cash contribution, up to $10,000.

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It applied to new home loan applications until June 28, and is subject to conditions, including the borrower having a minimum $300,000 loan and 20% equity.

It means if a loan’s worth $540,000, a borrower could get $5400.

“This market-leading cash offer is designed to put money back in the pockets of Kiwi at a time of rising costs,” senior product manager Pip Maxwell said.

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It comes as interest rates rise, on the back of the Reserve Bank’s efforts to reign in inflation, which sits at 6.9%.

Towards the end of May, it lifted the Official Cash Rate to 2%.

At the end of May, Kiwibank was among many banks to hike their home loan rates. It lifted its ‘special’ one-year fixed loan from 4.55% to 4.85%, for those with debt less than 80% of their home’s value. A two-year loan was 5.19%

Less than a year ago, the bank was offering a two-year fixed rate of 2.49%.

For savers, the bank is offering 3.15% on a one-year term deposit, for those with more than $10,000.

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