Mortgage deferral scheme not the only solution for older Kiwis
The Reserve Bank’s announcement of the extension of the mortgage deferral scheme from 27 September 2020 to 31 March 2021 may result in relief to some borrowers. However, for others, the relief may only be temporary. For those without the income required to resume payments once the deferral ends, the deferral will not be an option at all.
COVID-19’s impact has not been equal across the New Zealand economy. In particular, older workers may be more likely to be impacted by COVID-19 related job loss. According to Stats NZ, in 2018 there were 163,275 Kiwis over 65 in the workforce. Employment prospects are more challenging for this
demographic as there is less opportunity to re-skill and employers less willing to take on older workers.
For people over 60 a Reverse Mortgage could be an option to assist them stay in their home and remove the financial pressure of regular repayments.
A Reverse Mortgage can enable them to access some of the equity they have in their home without having to sell it. What’s more, borrowers are protected with a lifetime occupancy guarantee, which means they can stay in their home as long as they choose.
In the absence of the mortgage deferral scheme or a Reverse Mortgage, older borrowers may have no choice but to sell their home.
Heartland Bank is New Zealand’s leading Reverse Mortgage provider having helped more than 17,000 Kiwis live a more comfortable retirement. Heartland Head of Reverse Mortgages, Andrew Ford said “the mortgage deferral scheme can be a great temporary solution. However, a Reverse Mortgage can
provide some people with longer term financial flexibility and peace of mind.
Our customers often only require a modest amount, but the impact can be truly transformational”.
Find out more about Heartland’s Reverse Mortgage at www.heartland.co.nz.
Heartland Bank’s lending criteria, fees and charges apply.