A major financial support package has been announced for Covid 19 affected homeowners. Photo / File
A major financial support package has been announced for Covid 19 affected homeowners. Photo / File
Bay of Plenty property experts say the Government's six-month mortgage holiday for homeowners affected by Covid-19 will help stop panic-selling.
But a Tauranga budget advice manager is warning people to spend the short-term credit wisely.
Meanwhile, banks were experiencing high call volumes since the alert level 4 lockdown from customerswanting to take advantage of the financial relief.
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The Government, retail banks and the Reserve Bank this week announced a major financial support package for homeowners whose incomes have been affected.
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A Kiwibank spokeswoman said the bank was offering all existing home-loan customers up to six months of home-loan repayment holiday.
"Since the lockdown we have had an increase in calls. We are trying to work through this as quickly as we can."
The criteria was that they must be an existing Kiwibank home loan customer, had lost or had their regular income reduced due to Covid 19 or were about to experience reduced income, she said.
Westpac NZ customers affected by Covid-19 can also now apply for a six-month deferral on principal and interest repayments on home loans and personal loans.
The general manager of consumer banking and wealth, Gina Dellabarca, said repayment deferrals or holidays will help provide peace of mind for customers.
Dellabarca said interest would continue to accrue during the deferral period so customers should think carefully about whether they needed it and what it would mean for their future loan payments before applying.
"Customers who have made extra payments on their loan previously may now find themselves in a position where they can reduce the amount they are paying instead of taking up the deferral option."
Jones said there was going to be a lot of people out of work or being made redundant because of Covid-19.
General manager of Tremains Bay of Plenty and Waikato, Anton Jones. Photo / File
He said homeowners could probably get away with a couple of weeks but once it reached more than that "people are going to be hurting if they aren't already".
"Anything like this will help especially if you have lost your job," he said. "It would have been a terrible place if the Government hadn't introduced it."
Tauranga mayor Tenby Powell. Photo / File
Tauranga mayor Tenby Powell was thrilled the banks had come together to co-operate. "This is the right thing to do."
While six months was a good offer, he hoped it could be extended for those who experienced extreme financial hardship.
Rotorua mayor Steve Chadwick said people would need different types of assistance and it was good to see the Government developing a range of packages that could be targeted to those who needed it most.
Rotorua mayor Steve Chadwick. Photo / File
"Individuals and businesses should be ensuring they access whatever assistance is available for them and their situation."
However, Tauranga Budget Advisory Service manager Shirley McCombe warned eligible homeowners should spend the short-term credit wisely.
"Homeowners need to remember that they will still need to repay their mortgage. If approved they will just be given a mortgage holiday."
Tauranga Budget Advisory Service manager Shirley McCombe. Photo / File
McCombe said the other big worry was people may go to easy-to-get, over-the-phone and internet, high-interest lenders to get them through this time.
"If they are unable to repay the borrowing in a short amount of time, which is unlikely, the impact of high interest and fees could be catastrophic for some people."
How to budget your way through the Covid-19 lockdown - Clarify your income, talk to employers, and Work and Income etc. - Look at what is going out and how this can be reduced. - Speak to landlords and finance companies about how they can help. - Look at ways to make meals go further, eat from the garden (if you are lucky enough to have one) and avoid buying online to alleviate boredom. - Go to the Covid website and check out what support is available from the Government and speak with your bank regarding loans. Speak with your staff – you're all in this together. - Follow the rules, stay home and look after each other. Remember there is still help available from most social service organisations if you are dealing with addiction, abuse, mental health distress etc. - Call Tauranga Budget Advisory Service
