News - 27 April 2009

The Alpha Update

What are your Options When the Bank Says "NO" ?

Banks are very fickle these days, and different banks have different risk appetites. So, apart from using a great broker such as myself, what options do you have?

There are some lenders still providing finance beyond 80% of valuation, with some going as far as 95% for owner occupied properties if income is strong enough. Equally, there are several finance company lenders who provide some form or another of "lo-doc" loans (ie: security lending). Interest rates and fees are not cheap, and lending ratios are conservative, but these options do exist. And second mortgage providers continue to exist also.

So before you give up on a great deal, just because you haven't got a sufficient deposit or have a bad credit history, give me a call. In all cases you will pay lender and broker fees, but this may mean securing that great deal now, rather than seeing it go past.

Who do you know that need finance for a great deal but the Bank has said "NO"? Get them to call me TODAY on 021 676747 or 0800 676 747 to get professional advice and access to non-bank options

Food for Thought

Diplomacy is the art of thinking twice before saying nothing!

What's New??

• Lo doc lenders are re-emerging
• Commercial finance at up to 70% LVR

If you or anyone you know wants to know more about any of these products, email Stuart@alphagroup.co.nz

Interest Rate and Currency Comments

The Reserve Bank will most likely announce a further reduction in the Official Cash Rate this Thursday. Be it 0.25% or 0.5%, the reality is that it will make little difference to all but floating and short term (under 2 years) interest rates. Longer term rates are driven by offshore money supply, which is still highly constrained. Global growth is still predicted to be very negative, worse than the Reserve Bank's previous forecast. However, there are some "green shoots" of positivity emerging offshore. The hope is that an unexpected "frost" (ie: unexpected adverse major economic event) doesn't kill off those shoots before they bloom!

The kiwi has drifted lower over the past few days as the US dollar strengthened, but also on concerns about growth in NZ over the coming 2 years. Our economy is still shrinking, and the hope that we can export our way out of recessions looks gloomier due to weak growth or contraction in all of our major trading partners.

(See below for latest interest and exchange rates).

The Finance Markets

As of 8am on Monday 27th April 2009 the following Interest Rates applied:
Official cash rate 3.00% (stable)
90 day bill rate 3.06% (down slightly)
5 year swap rate 4.70% (down)
NZ/US Dollar 0.5721 (down)

Current Range of Interest Rates for home and investment mortgages as at 27 April 2009

Floating:
5.99% to 7.95% (stable)

Fixed For:
1 Year - 5.49% to 6.79% (stable)
2 Year - 6.09% to 6.99% (stable)
3 Year - 6.65% to 7.25% (up slightly)
4 Year - 6.99% to 7.55% (stable)
5 Year - 6.90% to 7.75% (stable)

For a complete table of interest and exchange rates, click here.

The information stated herein was correct at the time of release, but is subject to changes without notice.