Have your say: Westpac eases lending criteria to offer 90% home loans

An article by Tina Law in the Press has highlighted that Westpac has been offering home loans at up to 90% of a property's value. Mortgage brokers have also reported other banks lending more than 80%, Law said. New Zealand's banks tightened home loan lending ratios in late 2008 as the global financial crisis worsened a slump in the property market. Many banks dropped their 100% lending offers and moved to 80% being the maximum loan to value ratio. Here are some cuts from the article. We welcome your thoughts and comments below.

For the first time since banks tightened mortgage lending last year, Westpac has started advertising for home buyers with a deposit of less than 20 per cent. Mortgage brokers have reported other banks lending at more than 80 per cent of the value of the property. Mike Pero Mortgages chief executive Shaun Riley said Westpac had been selectively lending up to 90 per cent of a property's value. He said Westpac was probably thinking property prices had either bottomed out or would not fall much further and it was now more comfortable about doing a higher volume of lending above 80 per cent of property value. Westpac spokesman Craig Dowling said a combination of lower rates, funding being more accessible and vendors being more realistic on prices meant there were more opportunities for buyers. He would not say how low Westpac would be prepared to go, but a 10 per cent deposit was within lending bounds. The bank would probably not provide 100 per cent mortgages. ANZ National spokeswoman Virginia Stracey-Clitherow said it generally did not offer new lending in excess of 80 per cent, and it had no plans to change the policy. ASB retail banking chief executive Ian Park said it still had a policy of obtaining a 20 per cent deposit, and he believed it was inappropriate to review that in the current market. BNZ said it was continuing to provide home loans to customers with less than a 20 per cent deposit, but every application was treated on its merits. Kiwibank acting chief executive Paul Brock said it had always lent to people with less than 20 per cent deposit, but some of its special interest rates were not available to those borrowers.

Your view? Should banks be easing their lending ratios? Will this lead to another bubble? What will this mean for the correction in the housing market that some argue New Zealand needs? We welcome your comments below.