Best New Zealand home loan lenders for flexible repayments

If your main priority is being able to make extra repayments or change your regular repayments when your circumstances change, I would focus on repayment flexibility first, then compare interest rates and cash contributions.

A lower interest rate and a cash contribution can make switching attractive, but there is a catch: a cheaper fixed-rate mortgage may be less flexible than a floating-rate loan or a loan split between fixed and floating portions. The right choice depends on whether you want to make occasional lump-sum payments, increase your regular repayments, reduce payments temporarily, or repay the loan early.

In New Zealand, I'd start by comparing ASB, BNZ, ANZ, Westpac, Kiwibank and a flexible lending option through a mortgage adviser. The important distinction is not just which bank has the lowest rate, but which loan structure lets you manage your mortgage the way you want.

1. My top lender recommendations

1. ASB — best to consider for unrestricted extra repayments

Why I'd shortlist it: ASB's floating-rate home loan allows you to increase repayments, make additional payments and repay the loan early without early repayment adjustment costs.

You can also split your mortgage between fixed and floating portions, allowing you to keep most of your borrowing on a potentially lower fixed rate while retaining a flexible portion for extra payments. ASB also offers revolving credit for borrowers who want to repay and redraw money within an agreed limit. ASB's floating-rate loan and split-loan options explain these features. asb.co.nz, asb.co.nz

• Best for: People who want to make additional repayments whenever they have spare money.
• Main drawback: Floating rates can be higher than fixed rates and can change, affecting your interest costs and repayments.
• My view: A strong option if flexibility matters more than having your entire mortgage on a fixed rate.

2. BNZ — best to consider for a combination of fixed rates and flexibility

BNZ is worth considering if you want to make extra repayments without giving up the certainty of a fixed interest rate.

Its standard fixed-rate home loans allow you to repay up to 5% of your loan balance each year in additional payments without an early repayment charge, subject to the applicable terms. Its floating-rate loans allow additional and lump-sum repayments without early repayment charges. You can also split your mortgage between fixed and floating portions. bnz.co.nz

• Best for: Borrowers who want predictable repayments but also expect to make occasional extra payments.
• Main drawback: You need to understand the 5% limit and any charges that could apply if you exceed it.
• My view: A good compromise if you want flexibility without putting your entire mortgage on a floating rate.

See BNZ's home loan options.

3. Westpac — best to consider if you want to adjust regular repayments

Westpac stands out for borrowers who want to change the amount they pay regularly, rather than just make occasional lump-sum payments.

Its Choices Fixed home loan lets eligible borrowers increase regular repayments online by up to 20% above the minimum repayment, and reduce them again when needed. This is particularly relevant if your income varies or you want to accelerate repayments when you can afford to do so.

Westpac also offers floating-rate loans for greater flexibility. Lump-sum payments on a fixed-rate loan may incur a prepayment cost. westpac.co.nz, westpac.co.nz

• Best for: People who want to increase repayments when they have spare income and reduce them again when necessary.
• Main drawback: The 20% limit applies to the fixed-loan repayment feature, and other restrictions may apply.
• My view: One of the first lenders I'd investigate if the ability to adjust your regular repayments is your main priority.

See Westpac's fixed home loan and repayment options.

4. Kiwibank — best to consider for flexible variable-rate borrowing

Kiwibank offers variable-rate home loans that allow you to make unlimited additional repayments without extra repayment charges. You can also increase your regular repayments without a penalty.

Its fixed-rate loans allow additional repayments up to 5% of the original loan amount at the start of the fixed term each year, subject to its terms. It also offers offset and revolving-credit options. kiwibank.co.nz, kiwibank.co.nz, kiwibank.co.nz

• Best for: Borrowers who want to make regular extra payments or occasional lump sums.
• Main drawback: The variable rate may be higher than the fixed rate available to you.
• My view: A worthwhile alternative to ASB, particularly if you want to compare flexible loan structures.

See Kiwibank's variable-rate home loan.

How I'd rank them for your needs

Lender	Main flexibility advantage	What to watch
Westpac	Increase regular repayments by up to 20% on eligible fixed loans and reduce them again	Fixed-loan limits and lump-sum charges
ASB	Make extra repayments without penalty on floating loans	Floating interest rate
BNZ	Make additional repayments within the fixed-loan allowance, or use a floating loan	Fixed-loan limits and early repayment charges
Kiwibank	Unlimited additional repayments on variable loans	Variable interest rate

This is a ranking of features relevant to your priorities, not an overall ranking of bank quality or the cheapest available mortgage. Your actual rate, eligibility and loan terms will affect which lender is best for you.

5. ANZ — another strong option, particularly if you want a flexible loan structure

ANZ lets you combine fixed, floating and flexible home loans.

On an eligible fixed-rate loan, you can generally increase regular repayments by up to $250 per week without an early repayment recovery, provided it is your first increase that year. You can also make an additional lump-sum repayment of up to 5% of your current loan balance each year without that charge, subject to the applicable conditions.

Its floating loan allows you to increase regular repayments without a fee, while its flexible loan is a revolving-credit facility that lets you repay and redraw money. ANZ's repayment options

• Best for: Borrowers who want to combine fixed-rate certainty with a flexible portion.
• Main drawback: Some changes to fixed-rate repayments may incur charges, and the flexible loan requires disciplined money management.
• My view: Worth including in your comparison, especially if you want flexibility without putting your entire mortgage on a floating rate.

See ANZ's home loan options.

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2. The loan structure I'd recommend for you

Rather than choosing a lender solely on its headline rate, I'd investigate a split home loan.

This means dividing your mortgage into two or more portions with different repayment rules.

For example, imagine you have a $600,000 mortgage:

Portion	Amount	Loan type	Purpose
Fixed portion	$500,000	Fixed rate	Benefit from a potentially lower rate and predictable repayments
Flexible portion	$100,000	Floating or revolving credit	Make extra repayments and manage spare cash

These figures are illustrative, not a personalised recommendation.

The advantage is that you don't need to pay a floating rate on your entire mortgage just to get the flexibility you want.

You could direct bonuses, additional income or savings towards the flexible portion while continuing to make predictable repayments on the fixed portion.

There are two main options to consider.

Option A: Fixed plus floating

This is a good fit if you want to make extra payments whenever you have spare cash, while keeping most of your mortgage on a fixed rate.

Option B: Fixed plus revolving credit

This can suit you if your income varies, you maintain savings or you want to be able to redraw money when necessary. However, revolving credit requires discipline: money available to redraw can easily be spent rather than used to reduce your mortgage permanently.

ASB, BNZ, Kiwibank and ANZ all offer combinations of loan types. You can explore their structures through the links above.

3. Before accepting the cash contribution, check these five things

The cash contribution offered by the new lender is worth considering, but it shouldn't outweigh the flexibility you need.

• Cash contribution clawback: Ask how long you must remain with the new lender before you can refinance again without having to repay some or all of the contribution.
• Early repayment costs: If your current mortgage is fixed, ask your existing lender whether breaking it to switch will trigger a break fee.
• Legal and switching costs: Account for legal fees and other costs associated with moving your mortgage.
• Repayment restrictions: Ask exactly how much you can pay above your scheduled repayments without incurring a fee, and whether you can reduce your repayments again if your circumstances change.
• Total cost, not just the interest rate: Compare the interest savings and cash contribution against the switching costs and any restrictions that could affect you.

One especially important question is whether you can reduce your regular repayments after increasing them. Some loans allow this more easily than others, and that feature could be more valuable to you than a slightly lower interest rate.

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4. My final recommendation

Based on what you've told me, I'd start with these three:

1. Westpac: Investigate first if you want the ability to increase and subsequently reduce regular repayments on a fixed-rate loan.
2. ASB: Investigate if making unrestricted extra repayments is your main priority and you're comfortable with a floating-rate portion.
3. BNZ: Investigate if you want a fixed-rate mortgage with a defined allowance for additional repayments.

I'd also compare ANZ and Kiwibank before deciding.

I wouldn't automatically move to the lender offering the lowest rate and the biggest cash contribution. I'd choose the lender that offers the best combination of total cost and the ability to adapt your repayments when life changes.

5. One question that would help me narrow this down

When you say you want flexibility, which of these matters most to you?

• A. I want to make extra lump-sum payments whenever I have spare money.
• B. I want to increase my regular repayments and reduce them again whenever I need to.
• C. I want to be able to access money I've already paid into my mortgage.
• D. All three are important.

Your answer would help me narrow the shortlist to the most suitable lenders and loan structures for your situation.