I like the old Maori proverb, Ma whero ma pango ka oti ai te mahi – With red and black the work will be complete. It doesn’t just remind us of how it is important to cooperate to reach a goal, it tells us how we can use different resources to attain a goal.

Not all Kiwis can afford to purchase a quarter-acre piece of paradise in the suburbs with one or a few payments. Mortgages provide an essential route for Kiwis to afford homes.

But traditional mortgage lenders, such as banks, may have difficult criteria and you may find yourself in mortgage trouble frequently.

If that’s your story it may be worthwhile to look at non-bank mortgage lending.

Who are Non-Bank Mortgage Lenders

According to the Reserve Bank, non-bank lenders are institutions that have been licensed to offer loan products but do not take deposits. That strikes off banks, building societies, and credit unions.

Since these institutions don’t rely on the public’s savings to lend, they do not need to hold a banking license. But that does not mean that non-bank mortgage lenders are under any less scrutiny or regulation by the Reserve Bank.

On the other hand, by the nature of their business models, these lenders may not have the financial muscle as banks, but their flexibility is incomparable to banks. Perhaps this is the reason why more Kiwis are trusting them. As of 2018, the lenders had grown their share in the home loan market to NZ$2.5 billion, a staggering 27% growth.

What kind of financial assistance is available?

Apart from the standard home loans as you would be familiar with from the banks, non-bank mortgage lenders offer more flexible terms and extraordinary home loans like:

• Low doc home loans
• Split-rate mortgages.
• Bad Credit mortgages

The bad credit mortgages are just as the name implies. If you’ve missed a couple of payments on your mortgage. Or maybe you are facing a mortgagee sale. You can get urgent financial assistance on your home loan, even with a bad credit record, from a non-bank mortgage lender.

The lender will charge slightly more to cover for the higher lending risk, but that may be a price worth paying to save your home from going to a mortgagee sale.

Why You Should Consider a Non-Bank Mortgage Lender

For starters, when you experience financial difficulty you want a partner who is flexible and can relate with you at a deeper personal level. Unfortunately for banks, their strength and size are also their Achilles. It’s hard to relate with customers on a personal level. Due to their size, banks must comply with a myriad of regulations and adopt ‘controls-based’ structures. On the other hand, non-bank mortgage lenders can adopt a more ‘customer-oriented’ structure and meet a wider range of client needs.

Most non-bank lenders in New Zealand are also customer-owned. Thus, they are not driven by profits and unquenchable shareholder demands. Instead, customers (who form the ownership) mark their values, mission, and objectives. With this in mind, they can offer competitive rates, and fees as well as less stringent mortgage qualification criteria.

If you are experiencing mortgage payment troubles, reach out to your lender and discuss how you can save your home from a mortgagee sale. If you are dealing with a bank and they seem not to understand your situation, talk to a trusted mortgage broker. They will help you get financial assistance from a non-bank mortgage lender.