The battle for home loan business just got more intense as mortgage market volumes slow.
Kiwibank is now offering customers one percent of their new home loan as a cash contribution, up to $10,000. The loan would need to be $1 million to qualify for $10,000.
This is a significant escalation in the cash-back incentive, which up until now had rarely maxed out over $5,000. And a 0.7% incentive rate has been more common.
Kiwibank's targets include first home buyers but their real target are switchers from the other main banks.
The cash contribution offer is available for new Kiwibank home loan applications applied for from June 7, to June 28, 2022 and is conditional on meeting certain conditions.
More information and terms and conditions on the offer can be found here on Kiwibank’s website.
To be eligible, loans must be drawn down by July 29, 2022 and the loan must be for at least $300,000. A minimum 20% equity is required and the borrowers regular income must be credited to a Kiwibank account. Loans for business purposes are excluded.
Strict clawback rules also apply. Within the first year, Kiwibank can claim back 100% of the cash contribution if you pay off the loan. Within the second year, they can claim back 75%; in the third year the claim back is 50%; and in the fourth year, they can claim back 25% of the contribution they paid the borrower.
Kiwibank has also launched two new interactive digital home loan tools, a first home buyer calculator and a repayments and structuring calculator.
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