Advisers call for servicing test rethink for borrowers

Leading advisers say banks continue to test customers' borrowing abilities at rates of close to 8%, despite the central bank rate falling by 0.75% since May. 

They believe lenders should adapt to the new environment and test borrowers at a more reasonable rate of interest.

Craig Pope, of Pope & Co Mortgages in Wellington, says the "magnitude" of the Reserve Bank OCR cut could lead to a rethink from the banks.

"I think the banks will start to look at that and ask 'is it fair?' Given the OCR has dropped, I'd think that would be high on the radar for banks."