Key Points:

A property owner unable to meet loan commitments says his $7 million Bay of Islands farm is being sold for $2.4 million.

Skip Tayler, of Tauranga, says the 125ha farm at Puketona, between Paihia and Kerikeri, was sold by the BNZ via tender well below its worth.

It was valued last year at $7.07 million, Mr Tayler said, and he is desperate to stop the $2.4 million mortgagee sale settling today.

BNZ spokeswoman Diane Maxwell said the bank went to great lengths to avoid such sales: "It's always a last resort as it's not good for us or the customer. We only do this under extreme circumstances."

Mr Tayler said he'd been unable to make any loan repayments since May. For some years, he made interest-only repayments on a $3 million BNZ loan.

But he was confident he could secure a loan through Australian channels and if this came through, he might be able to stop the sale settling.

"It's a living nightmare. It's hideous," he said. The farm meant a lot to him, having been in his family since 1981. He bought the property from his family when he was a teenager and leased it so he could develop properties in Tauranga. His former tenant - the lessee - was buying the place, he said.

"I'm desperate to stop the sale," Mr Tayler said, adding that he had been paying about $30,000 a month on the farm which had been leased for $25,000 a year. "I was too stretched to pay the interest because we could not sell our houses," he said.

The property developer said his net worth was $10 million 18 months ago but that had changed to being in debt for more than $2 million.

Earlier this month, banks promised to relax mortgage repayment conditions for struggling homeowners as part of a deal with the Government guaranteeing their overseas debts.

Last week, outgoing Finance Minister Michael Cullen said he had been assured responsible borrowers could "count on support from their banks" during the hard times ahead.

The BNZ said it shared concerns about the potential risks to Kiwis paying off debt. If a customer was having trouble, it could help by changing repayment requirements, giving a longer term to repay the mortgage or changing repayments to interest only or capitalising interest payments if there was an unexpected setback.