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More Kiwis now able to live the retirement they deserve

Heartland Bank has increased the maximum loan-to-value ratio (LVR) on our Reverse Mortgage product. This is the biggest change to reverse mortgage criteria since we introduced a monthly advance feature in 2017 and the first time the limits have been increased since 2004.

Andrew Ford, Heartland’s General Manager – Reverse Mortgages, said, “this change will enable Heartland to help more people to live a better retirement without having to sell their home.”

The LVR limits are used to determine the maximum amount a customer can borrow, based on their age and the value of their property. Heartland encourages customers to only borrow what they need and has a number of controls in place to ensure this.

The vast majority of customers only borrow a modest amount, with the average initial LVR in the 12 months to 30 September 2021 being just 9%.

Andrew Ford added, “in a recent survey of over 2,000 Kiwis, only 12% said NZ Super was enough to live the retirement they desire. Using a reverse mortgage to tap some of the equity in their home can be a great way to live a more comfortable retirement.”

Strong demand

With the pressures of high inflation and increasing financial demands weighing on Kiwis aged 60 and over, Heartland is finding that more and more customers are struggling to make ends meet.

“We are seeing a strong increase in demand, with new business up 70% in the four months to 31 October 2021 compared with the same period in 2020. Higher property prices, low interest rates, increasing indebtedness in retirement, and an aging population, along with greater awareness and acceptance of reverse mortgages, are all contributing to this,” explained Ford.

New loan-to-value limits

The maximum LVR is increasing by 5%. The new maximum LVR for a 70-year-old is 30%. This is rarely taken upfront and typically drawn down progressively via a monthly advance over 5 to 10 years, and/or with some held in a cash reserve facility (line of credit) for future needs or unexpected expenditure.

Heartland is proud to have helped more than 19,000 people retire more comfortably. To find out more about a Heartland Reverse Mortgage, go to

Heartland Bank’s responsible lending criteria, terms, conditions and fees apply. Interest rates are subject to change.

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