ASB joins low deposit Kāinga Ora scheme with some benefits

ASB joins Kiwibank, Westpac SBS Bank, The Co-operative Bank, Unity, Nelson Building Society and NZHL who are already part of this scheme.

The first home loan is designed for people who can afford regular mortgage repayments but are finding it difficult to save a 20% deposit. Instead of the standard deposit, eligible buyers can purchase their first home with just 5%, with the loan underwritten by Kāinga Ora.

Eligible customers who have been contributing to KiwiSaver for at least three years may also be able to withdraw their savings to put towards their home purchase and will be eligible for ASB’s first home buyer cashback offer. The offer is at least $5,000 for mortgages of $200,000 or more.

However, borrowers will be required to pay a one-off Lenders Mortgage Insurance (LMI) fee of 1.2% of the loan to protect the lender. On a $500,000 mortgage that is about $6,000 that either needs to be paid when the loan is drawn down or added to the total mortgage amount.