Tuesday, December 15, 2009

NZ Home Loans Review - Extremely Poor Service


I know this is off-topic but I simply must have a rant and warn anyone who will listen about this company and their evident incompetence and lack of interest in righting their mistakes.

I was very shocked disappointed with the results and with the advice I have received.  I was given advice without proper disclosure of conditions, risks, and with disregard for jeopardizing a great deal of my money. My complaint centers around quality of advice and a verbal pre-approval with the single condition that the valuation is to be more than the purchase price at auction.  

I originally approached NZ Home Loans on the 1st of October, and was impressed by their friendliness and informality.  During this first meeting we told our broker that we wished to attend an auction on the 21st of October. We were told it would be easy to turn the application into an approval before then.  After various chasing phone calls I finally received word on the 16th of October, that I had been approved but with a condition that they required a valuation of the property to be completely unconditional.  This was disappointing as there now was not enough time to organise a valuation before the auction on the following Wednesday.  

We discussed this, and I was advised that the valuation is only about ensuring the purchase price is not more than the valuation.  I agreed to take the risk of going to auction with only a verbal conditional pre-approval with the understanding there was only one condition. This condition was simply disclosed to me as obtaining a valuation for the property to ensure the value is more or equal to the purchase price at auction.  The broker arranged a valuer friend to quickly and informally preview the property prior to auction to give some confidence where the value will be. At no time was I made aware that the formal valuation could raise 'other' potential 'declineable' issues. There was no disclosure that despite the valuation price being well clear of our purchase price it could still be declined. In my opinion these were hidden and undisclosed conditions that I was completely unaware of. This is the exact reason why we seek advise from experienced professional people to begin with is it not?

After reading my email trail again, I also cannot help but question the speed of handling our application.  The loan application documents were hand delivered on the 7th of October. The broker was aware of our interest in attending the auction on the 21st of October.  I was notified by telephone on Friday the 16th of pre-approval for my application, but that one condition as stated above. We were originally told prior, that the requirement of a valuation is "unlikely".  So at this point there was not enough time to organise a valuation, or for this valuation to be processed by NZ Home Loans.  So on advice I proceeded with plans to attend the auction knowing that his valuer had previewed the property and was comfortable it was easily well clear of what my personal budget ceiling.  After winning the auction I waited 4 weeks to get this final response. If this was a standard settlement period I would have been forced to default on the settlement. I chased this up during this period with phone calls and emails, usually with no response. One response was "we seem to have lost the documents, can you please resend"!

On Tuesday the 17th I was advised that they had been forced to decline my application!  Then, on the Wednesday I was then told this decision wasn't a 'No' after all, but if we obtain a structural builder's report and moisture report there may be a chance. Failing that, the suggestion was to max out our credit cards to fund an additional 30k deposit!

At that point I decided to ditch NZ Home Loans, and take the risk of finding funding elsewhere. Incidentally, our approval with our new lender was turned around in 36 hours completely unconditional. Big Thanks to Westpac New Zealand. After complaining to NZ Home Loans head office I get a phone call from the manager asking to discuss the situation.  Which I happily did 6 days later and told them exactly how I felt about the whole foul up.  During this meeting, his way of making things right was to offer me an approval for funding; a little late I think to say the least.

I wish I lived in the States where suing these clowns would be much easier. However I haven't ruled out contacting the Ombudsman. At the very least I will be vocal about my experiences to my family, friends, and in my tweets and blog posts. I think there was a severe failure in procedure and it seems to me that competency levels are well short of what they should be.

Please think twice before risking their service. Happy home ownership :-)


  1. This people should realize that their clients rely to them because of their expertise and credibility, but when things doesn't turn up as you expected, things are in real mess. For months now still waiting for loan approval overshooting every commitment that we have agreed with the seller.

    What is this company? broker, middleman or just percentage earner? They now took charge of my insurance as agent, do they get something from it, I'm sure they do.

    Then I'f they are just agent, then we are better off doing business directly to the

    Correct me if I'm wrong but I'm losing patient from this people grrrr. They create so much stress to your health.

  2. My advice is to not deal with NZ home loans at all. They have no processes in place to ensure their brokers are reliable and competent.

    Mike Pero Mortgages saved the day for me and I highly recommend them. Especially Shayne Gough on the Takapuna franchise.