Whether it’s saving your home from a mortgagee sale or getting a new loan when the banks say no, second tier lenders or non bank lenders can provide solutions. They also provide specialized knowledge and flexibility in lending.

These second tier lenders nz can help with your investment property portfolio and are usually more receptive to issues like bad credit or irregular income. Here are some of the benefits of second tier lenders:

Flexibility

Traditionally, second tier lenders have been seen as less ‘safe’ than the major banks. It is partly because they are regulated differently and have stricter lending policies. However, a lot of second tier lenders are coming out with some pretty competitive products for property investors that can rival the main banks.

They are also a lot more flexible when it comes to what you can use your loan for and who you can lend to. It includes a greater number of self-employed people, people with bad credit ratings and those who are beneficiaries.

This flexibility is good news for borrowers who have been rejected by the big four. It’s also great news for those who are at a stage in life where they don’t have their finances sorted or have a nagging doubt about their income stability.

Generally speaking, these lenders do have higher interest rates than the big banks because they are considered to be riskier. It means they have to pay more for the same capital and will typically charge a premium on low-deposit loans (although this can be negated with a mortgage broker). However, these higher rates aren’t as high as you might think. For example, the one-year rate special from ANZ for people with a 20 per cent deposit is 3.85 percent. Compare that to Bluestone’s 4.49 percent, and the difference isn’t huge.

Competitive Rates

Getting a loan from second tier lenders nz is an option worth exploring when the main banks turn you down. You’ll often find the interest rates on these loans are lower than the big four banks. In addition, there are usually less strict lending conditions and upfront fees with these lenders.

Another benefit of second tier lenders is they can offer a solution to borrowers with bad credit or limited financials. These lenders can help people who may have defaults or judgments on their credit history or those who earn a limited income through casual work and can’t easily prove that they are earning money.

Fast Approval

The mortgage market is incredibly competitive right now. It is largely due to APRA’s control of our big four banks. The banks are changing their lending appetites on a regular basis, which can mean borrowers need to be prepared to spend more time searching for home loan products.

Second-tier lenders are often more receptive to applications that might have been declined by the big banks, such as bad credit or issues with income (being self-employed, inconsistent employment, being a beneficiary, etc). They can also be more flexible around things like having a small deposit and mortgage arrears.

Another benefit of second tier lenders nz is that they can be quicker to approve loans because they don’t have to run your details through the same screens as the big banks. It can be a huge advantage if you’re in a rush to get your next property deal underway.

For savvy investors who want to grow their portfolio quickly, second tier lenders can be an essential tool. They’re bringing to market really attractive loan products that can help to increase the speed at which you can buy and sell properties. Plus, their rates are competitive, and they’re able to give you access to more cash equity than many of the major banks can. For those who have been threatened with a Property Law Act notice or are at risk of having their home taken over by the bank through mortgagee sale, a second tier lender could save the day!