The government's move to ease controversial new lending rules has received tentative support from lenders and budget advisors.
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It is amending changes that were made to the Credit Contracts and Consumer Finance Act (CCCFA) in December 2021, which aimed to clamp down on predatory lending.
Almost from day one there were complaints that the rules were too restrictive, the information required too intrusive and unreasonable, and the time taken to process applications too long.
The new amendments mean lenders would not need to check current spending from recent transactions when assessing future spending, nor would current savings and investments be regarded as outgoings.
The requirement to obtain information in sufficient detail would only relate to information provided by borrowers directly rather than information from bank records, while new guidance would be given to lenders on what would be an obviously affordable loan.
Kiwibank chief executive Steve Jurkovich said it was pleasing to see the government act quickly as it would make a significant difference for consumers.
Kiwibank last month reported about a third of its applications were being delayed or denied because of the new rules.
Jurkovic said the changes would mean a customer with a good credit history could get a home loan top-up or refinancing existing debts faster, but the announcement was light on detail.
"There are some areas where there was ambiguous guidance and other areas where it's quite clear what's required. We're going to need to see the specifics if that's going to change."
Budget advisory service FinCap, a strong advocate for the December changes, said the amendments appeared on the surface to continue to ensure vulnerable people would be protected from getting into unaffordable debt.
But its senior policy advisor, Jake Lilley, said time would be the best judge.
"It is hard to say exactly until we can confirm the detail of what was announced this morning but we are reassured that the government has the interests of whānau front of mind.
"Some lenders seem to already be pushing the new laws so we're keen to see those tested over the next year or so and make sure they are working for people on the ground, keeping them away from hardship."
Lilley said he would like to see the CCCFA reviewed again in future to make sure the legislation was working as intended.
