Westpac has removed its higher interest rates on high loan-to-value mortgages, but has retained its existing low equity margin on high LVR loans.
The move from Westpac, applying from today, matches one recently made by the BNZ.
Westpac says customers with over 80% LVR will" benefit from the same carded rates as customers with under 80% LVR".
It also says 6 month and 1 year fixed rates will again be available to customers with over 80% LVR.
"No changes have been made to LEM and it still applies to over 80% lending, the bank said
The Reserve Bank introduced restrictions on banks' high LVR residential mortgages from October 1 last year.
This means banks must restrict lending at LVRs above 80% (where borrowers don't have a deposit of at least 20%) to no more than 10% of total new mortgage lending.
This 10% limit excludes high LVR loans made under Housing New Zealand’s Welcome Home Loans scheme, the refinancing of existing high-LVR loans, bridging finance or the transfer of existing high-LVR loans between properties, and new residential construction loans.
Two tier home loan offers became common from New Zealand banks last year with the Reserve Bank's high LVR restrictions being introduced. Most other banks still have them. See all carded, or advertised, bank home loan rates here.
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