Changes to lending rules coming into effect on July 7

A date has been set.

Yesterday, the Ministry for Business, Innovation and Employment (MBIE) confirmed long-awaited changes to the country’s lending had been finalised and would come into effect on July 7 — a month later than initially due.

In March, Minister of Commerce and Consumer Affairs David Clark announced amendments to the Credit Contracts and Consumer Finance Act (CCCFA) to try to fix the unintended consequences it was having on the mortgage market.

The changes include removing regular savings and investments as an example of outgoings lenders need to inquire into.

It also clarified that when borrowers provided a detailed breakdown, there was no need to inquire into present living expenses from recent bank transactions.

For the past three months, the MBIE has been consulting on the draft changes and received feedback from several stakeholders, including lenders and financial mentors.

The ministry put the delay down to the amount of feedback received.