G.J. Gardner launches finance company expecting to lend up to $150 million a year.

New Zealand's biggest house builder has launched its own "no tears" finance company, expecting to lend up to $150 million annually after clients struck problems getting mortgages.

Grant Porteous, one of the owners of the master franchise for Albany-headquartered G.J. Gardner Homes, said the new business, Onion, was established to help new home owners get money to see them through the job.

"This comes out of the frustrations with the banks and lenders putting people off a new home. It's more difficult for them to document a construction loan than an existing-house loan. Yet is is cheaper to build a new house often than to buy an existing one," he said.

Lending rates are being promoted as "generally more competitive than if you deal directly with the bank".

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Peter Leitch, Professional Advisers Association immediate past chairman and a board member, welcomed Onion.

"If the Government continues to encourage people to build new homes by not having LVRs on them, I would expect that facility would be used," he said.

Porteous said Onion would only lend to G.J. Gardner clients initially and might eventually move into insurance. "Onion's key purpose is to make buying or building a new home easy by providing skilled specialists in finance and insurance with extensive knowledge of the housing market and home building sector," he said.

The lending issue created obstacles for many, he said, and Onion could also provide funds for buyers of existing houses which new house-builders needed to quit before they could start their construction project.

Onion was sourcing its funds from banks including ASB and Westpac.

Around 200 loans could be written annually initially, he forecast.

G.J. Gardner has 28 franchisees around the country and expects to build nearly 1000 homes in the year to March. Onion was established by the company Porteous Fraser Dent which was Porteous and his wife Ellie, Brett Dent formerly of financier Marac and new business partner Mike Fraser who was running G.J. Gardner's Rodney franchise.

Porteous said some loans could go as high as 90 per cent of a new-house build value.