TOUGH STANCE: ANZ National, the largest bank in New Zealand, now requires people wanting a mortgage to buy a house to have a 20 percent deposit.

ANZ gets tougher on mortgages

By PAM GRAHAM | Thursday, 27 November 2008

ANZ National, the largest bank in New Zealand, now requires people buying a house to have a 20 percent deposit.

The policy, which applies from today to new loan applications, is a tightening from its previous position of a 10 percent deposit.

Mortgage brokers said a tightening of lending criteria is a trend. Other lenders already require a 20 percent deposit or offer a better interest rate for such loans.

The bank said each customer was treated as an individual and there was no "standard scenario".

But generally speaking, both its ANZ and National Bank brands would not be offering new lending in excess of 80 percent loan to value ratio. This means a mortgage cannot be more than 80 percent of the value of a property.

David Tripe, director of Massey University's Centre for Banking Studies, said the move was understandable in a falling property market.

- NZPA

That's insane! a 20% deposit is out of reach for most average income earners. Sigh, there goes my soon-to-be house for me and my honey.... =(