New Credit Laws(CCCFA) and the First Home Buyer
The festive season of December, which was supposed to bring new hope and joy, distressed the kiwis with new legislation. As the government imposes strictness on the lenders so they, in turn, began putting a lot of pressure on borrowers. Amidst confusion and tension, Dev and Ashley came up with an interactive session whereby they shed light on this broiling issue.
Ashley Church reflects on both sides of the situation. As per his viewpoint, on the one hand, the government introduced this new credit law to protect borrowers against unscrupulous lenders. On the other hand, borrowers are being rejected on loan applications by banks due to this legislation. Ashley’s contemplation on the grim situation indicates the loopholes persisting in the new law, and it’s high time government should review it.
The lenders are filing petitions in protest, and meanwhile, Mr David Clark, Commerce Minister, hinted towards the bank’s limited measures to comply with lending rules. He even mentioned conducting an enquiry concerning amendment in the legislature. Clark’s statement has, though, offered a sigh of relief to the borrowers still; challenges are frustrating kiwis.
Dev Dhingra, CEO & Founder at Fundmaster, considers that there are even underlying factors responsible for the bank’s rejection of customers’ loan applications. One such component is incorporating an expense calculator to assess whether a home buyer is overspending or not. Dev opines that when new legislation is introduced concerning lending or borrowing, people take a back foot instead of dealing with the situation.
Ashley believes that besides this CCCFA law, the Reserve Bank should remove some restrictions on loan to value ratios at least for first-time home buyers so that they can afford their dream home without much hassle.
A positive approach can help overcome barriers put forward by any kind of market situation or laws. When making first home-buying decisions, it’s better to keep track of expenses to understand where and how to save for a house deposit. In this regard, Dev suggests that first-time home buyers should spend wisely and in case of any issues while structuring finances, consult a mortgage broker who can make things clear and simple for them.
If you are one of those borrowers’ facing difficulties in getting a loan approval or are confused about how to deal with the legislation, please watch this video and share it with your friends.
Dev Dhingra
I've dedicated my career to helping Kiwis achieve their dream of homeownership. As the founder & CEO of Fundmaster, my mission is to transform the mortgage industry and make buying a home more accessible for everyone.