APIA Blog

RSS Feed

Covid-19: Mortgage holidays

Friday, March 27, 2020

A what-do-we-know-what-don't-we-know about mortgage holidays so far: 

  • Debt-deferral, not debt-forgiveness: Interest will continue to accrue for the duration of the 'holiday'; 
  • More information to come: Most banks have signaled that more information/firmed up packages will be announced the week of 30th March; 
  • Packages designed more for owner-occupiers rather than investors: Investors should get in touch with their brokers for a more global and long-term approach; 
  • Hold if you can: We expect rules around mortgage holidays, refinancing, restructuring to be relaxed in the next week or so until banks can put out packages that speak specifically to the challenges of Covid-19 and that reflect the deal they have struck this week with the government; 
Some tips for investors: 
  • Talk to your broker: Resist the urge to knee-jerk, get in touch with your broker to get a strategy in place. We note that our broker partner Kris Pedersen Mortgages & Insurance is on extended hours to help investors through these times; 
  • Don't rush to call: Banks are absolutely inundated this week helping customers with immediate cash-flow challenges if you are able to, give your bank some space to deal with those calls first; 
  • Email and use online forms: Let's do our bit to avoid overloading the phone network, email or use online banking secure mail facilities if you can; 
  • Be clear with your bank: Tell them exactly what relief you are after (mortgage holiday/restructure/refinance) and how your income is affected to minimise back and forth; 
  • Get onto Twitter now: For live announcements (ANZ, ASB, BNZ, Kiwibank, Westpac) or get into the habit of Googling '<bank name> Covid-19';
  • Break-glass only if you have to: In general, only consider mortgage holiday as a break-glass solution, there are other less financially onerous options available such as breaking early to refix or go interest-only; 
  • Communicate with your tenants: We are already hearing about tenants demanding a rent reduction in light of the government's mortgage holiday announcement. Many people think a mortgage holiday means that the landlord's mortgage debt is forgiven or underwritten by the government and that is not true. It is also not their fault to think that. Everyone is stressed and scrambling. Empathy is a luxury many people don't have right now. Take the heat out conversations. Don't put yourself under the illusionary pressure that you have to respond to a request/plea/demand for rent reduction straight away.  Let your tenant know that you need some time to work out your options and that a mortgage holiday will ultimately put you under more financial pressure. Be compassionate. Be honest. People have a great capacity to be kind, we just all need to have a bit of faith in each other right now. 

General advice from Kris Pedersen Mortgages & Insurance:

 

 

Recent Posts


Tags

ventilation Investor story Q&A initio property cycle rta reform legal Jeff Bezos Property (Relationships) Act interest only p lab covid-19 election 2017 inspection partners housing bubble education capital gain robert kiyosaki rental market ring-fencing ask an expert Sponsored post meth contamination asbestos relationship property airbnb lvr ocr off the plan parry v inglis productivity property management auckland maintenance extractor fan data security reserve bank minor dwelling first home buying anz water bill RBNZ buyer's agent heating wealth creation mindset return negotiation tax letting Question and answer shower dome market trespass cgt meth HHS investor sublease Landlording renovation rta banking bond rent increase privacy Investment tip letting fee equity interest rates khh heater television warm up new zealand CCC How to Level 4 Holler Tribunal case study kiwibuild structure tenancy issues unitary plan election2020 scotney williams house prices Standards New Zealand property maintenance HHGA sale and purchas Editor's Choice Must knows bad tenant commerce commission buying property value property apprentice beginner investor management twg report holiday house insurance mortgage nzpif positive cash flow government damage winz sale and purchase wins tenant subdivision fixed-term tenancy building DTI barfoot and thompson Kris Pedersen Mortgages and Insurance financial advisers act tenancy tribunal smoke alarm watercare landlord trademe opes partners Guest blog insulation warren buffett termination skill shortage trust development rtaa2020 ird worksafe housing affordability bond form finance LIM Market report TCIT rental wof buying rules cat RTAA 2019 CoreLogic market rent business cash-flow debt enforcement rent arrears yield HSWA boarding house speculator Must know short-term rental Gluckman will advice rent investment strategy personal growth gluckman report recycling equity income tenancy services clnz auckland council Case study principal and interest

Archive

Introducing Our Partners
Principal Sponsor - Kris Pedersen Mortgages & Insurance logo Gold Sponsor - Barfoot & Thompson logo Gold Sponsor - CoreLogic logo Property Apprentice logo The Insulation Warehouse logo The Renovation Team logo The New Zealand Property Investors' Federation logo
09 360 2376
info@apia.org.nz

The Tenancy Practice Service and TPS Credit Control work closely with the Auckland Property Investors' Association. Our vision of bringing helpful resources, documents and high quality services to Auckland Property Investors and Property Managers is shared by APIA, so its a partnership that works well. 

The Auckland Property Investors' Association is a great organisation for those who want access to advice and information from a range of industry experts and partners. 



Mathieu Holt- Managing Director, The Tenancy Practice Service & TPS Credit Control
Through the Association I found the channels and methods to fund the purchase of property I never dreamed about. Grant Brown

All round it has been one of those things Neil and I felt was really worthwhile belonging to. We have learned so much it has just built our confidence in what we are doing.

Janice Bieleski
I read two articles in the monthly magazine that saved me over $5,000. That is my membership fee for the next 26 years and I am sure I will learn a whole lot more! John Duncan
Fantastic organisation. The networking opportunities are brilliant and provide us with information and opportunities that cannot be obtained anywhere else. We learn something new at every meeting and we've been in this game for nearly 20 years. Pauline and Gyanen Kumar

I find the information obtained from various APIA meetings very useful in guiding my own property investment and rental management.  I also enjoy the networking opportunities with like-minded investors.  I am inspired by other investors’ success and find the more experiences and knowledge that I share with others, the more confident I become.  

Thanks to all APIA event organizers and administrators for your brilliant work. 

Stella Shao

I like talking to people and learning from their experience because it gives me the confidence to invest well. I think it is a knowledge thing. I now know I am doing things the right way.

Stephen Weatherall

My APIA membership has become a total success.

Every time I attend a monthly or regional meeting I come away with so many useful and positive tips that have added value to my property investments and management.

Not only that, the website is a great place for practical advice and useful information. It has now evolved into an important resource for my business.

Talk about value for money! The discounts I have been getting at Bunnings when I present my APIA membership card have more than paid for my annual subscription!

Tim Duffett, Plan A Investments Limited