Kiwi-owned Heartland Bank has announced a new digital-only mortgage rate of 1.99 per cent. It’s the first time a mortgage rate below 2 per cent has been offered in New Zealand.
The one-year fixed rate is only available to owner-occupiers with a deposit or equity of at least 20 per cent. It’s also only on offer to those buying a standalone house on a single section.
Heartland said the offer would only be available for a limited time, and said it was passing on to borrowers the lower costs of onboarding thanks to its digitalisation strategy.
But with the New Zealand OCR currently at a record low of 0.25 per cent and the Government stepping in with a ‘funding for lending’ scheme, other banks are expected to follow. The Australian-owned banks and Kiwibank are currently offering one-year fixed rates of 2.55 per cent.