If your household income has dropped, your savings buffer is thin, and you haven't missed a mortgage payment, this is the right time to approach your lender — before you fall behind. In New Zealand, you may have options to reduce your repayments or temporarily make them more manageable, depending on your loan, income outlook and lender's hardship policies.

The important distinction is between a lender that is good at approving a mortgage in the first place and one that responds well when an existing customer is under financial pressure. For your situation, I'd focus on how a bank handles early hardship requests, whether you can speak to a specialist, how quickly it assesses options, and whether it explains the long-term costs clearly.

Which New Zealand lenders are worth looking at?

I wouldn't claim that one bank is definitively the best at treating customers in hardship: I couldn't find comparable, independent evidence that reliably ranks New Zealand banks on hardship outcomes. But several publish specific support options, and those policies give you a useful starting point.

1. Kiwibank

Broad range of options

Kiwibank describes having a dedicated hardship support team and explicitly recognises unexpected income reductions. Its published options include interest-only repayments, extending the loan term, restructuring and repayment deferrals. It says there is no application fee for hardship assistance, and outlines its response timeframes. Financial hardship & assistance | AccountsHaving trouble making payments | Home loans

Why consider it: Its published policy is clear about the different ways it may be able to reduce immediate repayment pressure.

Kiwibank hardship support · 0800 222 497

2. ANZ

ANZ publishes short-term repayment relief of up to 90 days and the option of restructuring a home loan. It says it aims to contact applicants within five working days, and will discuss other options if an application is declined. Apply for financial hardship assistance

Why consider it: Worth asking about if you expect your income reduction to be temporary and need breathing room while circumstances improve.

ANZ hardship assistance · 0800 240 438

3. Westpac

Westpac lists reduced repayments, loan-term extensions, repayment pauses or deferrals, and possible interest-rate reductions on some lending products. It has a dedicated Financial Solutions team for customers experiencing difficulty. Financial hardship support

Why consider it: Its published options are worth discussing if you need a tailored arrangement rather than a simple repayment holiday.

Westpac hardship support · 0800 772 771

4. BNZ

BNZ allows personal banking customers to request a written hardship variation, including a longer loan term, postponed payments, or both. It asks customers to apply promptly because eligibility is subject to limits and assessment. Financial hardship application

Why consider it: A clearly documented application process gives you a concrete way to request a change to your mortgage terms.

BNZ financial difficulty support · 0800 375 007

5. ASB

ASB has a Financial Assistance team for customers affected by events such as unemployment or reduced income, as well as a Credit Solutions team that discusses repayment arrangements for home loans and other lending. Financial hardship assistance with ASB

Why consider it: Its published support includes dedicated teams for different levels of financial difficulty, so you can ask which route suits your current position.

ASB financial assistance · 0800 27 27 35, option 3

These are options to investigate, not a ranking of actual customer outcomes. Each bank assesses individual circumstances, and publishing a wide range of options doesn't guarantee approval.

What matters most in your situation

Because you still have a clean repayment record, I'd prioritise keeping the mortgage affordable without unnecessarily using up your remaining savings.

Ask your existing lender to compare these options in order:

Option	Potential benefit	What to watch for
Reduce repayments to the required minimum	Immediate relief if you're paying above the minimum	Check exactly what your loan agreement permits
Temporary interest-only period	Frees up cash by pausing principal repayments	Your balance generally won't decrease during this period
Extend the mortgage term	Reduces regular repayments	Usually increases total interest paid
Repayment holiday or deferral	Provides a temporary break from payments	Interest usually continues accumulating, increasing the debt
Restructure or refix the loan	May improve cash flow or make payments more predictable	Fees, fixed-rate break costs and future repayments may apply

These options and their trade-offs are described in New Zealand's official consumer guidance and by the Banking Ombudsman. Mortgages and home loansHardship and financial difficultyHaving trouble making payments | Home loans

My practical recommendation: Start with the bank that currently holds your mortgage. Explain the income reduction and ask for an affordability review before a payment is missed. Switching lenders isn't automatically the answer; a new lender may be reluctant to approve a transfer when your income has fallen, and switching can involve costs.

Your rights and safeguards in New Zealand

• You can ask your lender about support before missing a payment.
• If an unexpected event means you cannot reasonably meet your repayments, you may qualify to apply for a formal hardship variation under the Credit Contracts and Consumer Finance Act. Eligibility and timing requirements apply.
• Lenders must consider a qualifying application properly, but they aren't required to approve every request.
• The official guidance says lenders generally must acknowledge a formal application within five working days and decide within 20 working days, provided the necessary information is available. Payment problemsHardship and financial difficulty

For independent, free help, contact MoneyTalks. A financial mentor can help you build a realistic budget and, if needed, communicate with your lender.

Let’s narrow this down to the best approach for your household

There are two things that would change my recommendation substantially: whether your income drop is temporary, and whether your current mortgage is already at the minimum repayment level.

Is the household income drop likely to be temporary (for example, a few months), or is it an ongoing reduction? That will help determine whether to prioritise short-term relief or a more sustainable change to your mortgage repayments.

Which New Zealand mortgage lenders are best at helping when household income falls?

Given your situation — your household income has dropped, your financial buffer is small, but you haven't missed a mortgage payment — I would focus on lenders that have clear financial-hardship processes, offer practical ways to reduce repayments, and are willing to discuss options before you fall behind.

My strongest advice is to contact your current lender now, rather than waiting until you miss a payment. You may have more options while your mortgage is still up to date, and you can ask about temporary relief without committing to refinancing or selling your home.

There isn't enough reliable evidence to declare one New Zealand bank universally the best at handling financial hardship. A more useful approach is to compare their published hardship policies, the flexibility of their mortgage products, and the options they can offer in your particular circumstances.

1. Which lenders are worth looking at?

Based on the published support options available from New Zealand's major banks, I'd start by comparing Kiwibank, ANZ, Westpac and BNZ. Each publishes a process for helping customers experiencing financial difficulty, but the types of relief and the terms differ.

These are not rankings of customer satisfaction or proven outcomes. They're a practical shortlist based on the support each bank publicly describes.

Kiwibank — worth considering for interest-only options and tailored support

Kiwibank explicitly lists several options for customers struggling with loan payments, including:

• Temporary interest-only repayments: You pay interest but temporarily stop paying down the principal.
• An extension to your mortgage term: This can reduce regular repayments while allowing you to keep paying off the principal.
• An affordable repayment plan or repayment deferral.
• Restructuring your mortgage to better fit your circumstances.

Kiwibank also has a dedicated financial hardship team and says there is no fee to apply for hardship assistance. Its published guidance makes the trade-off with interest-only repayments clear: your mortgage balance won't reduce during that period, and your overall borrowing costs will increase. Kiwibank's financial hardship support and guide to struggling with mortgage payments.

Why I'd consider it: If your immediate problem is that your usual mortgage repayments consume too much of your reduced income, Kiwibank explicitly identifies several options worth discussing.

ANZ — worth considering for a structured hardship review

ANZ has a formal financial hardship assistance process that specifically recognises a recent reduction in income as a potential reason for assistance.

Depending on eligibility and your circumstances, ANZ says it may offer:

• Short-term repayment relief of up to 90 days.
• Restructuring of your home loan.
• Reduced repayments through a longer loan term.
• Temporary interest-only repayments.

ANZ also provides a dedicated application process and says it will contact applicants within five working days. It may ask for payslips, bank statements, details of other debts and evidence of household expenses. ANZ's financial hardship application and options for financial difficulty.

Why I'd consider it: ANZ explicitly recognises reduced income as a reason to seek assistance and sets out a formal process for reviewing your situation.

One important qualification: applying for ANZ's formal hardship assistance cancels any existing pre-approval you have for an ANZ credit product. Ask about the implications before applying if you have a pre-approval you need to preserve.

Westpac — worth considering for a range of temporary relief options

Westpac publishes a financial hardship process for borrowers who are already struggling or who expect to struggle soon.

Depending on your circumstances, it may offer:

• Reduced repayments for a period.
• An extension to your mortgage term.
• A temporary repayment pause or deferral.
• Other changes to your lending arrangements.

Westpac says applications are assessed individually. Its Financial Solutions team can explain the additional interest costs and repayment implications associated with different arrangements. The bank also describes a support period intended to help customers get back on track after temporary relief ends. Westpac's financial hardship support and explanation of hardship assistance.

Why I'd consider it: Its published options cover both immediate repayment pressure and longer-term adjustments, which is useful when you aren't yet sure how long the income reduction will last.

BNZ — worth considering for a formal hardship variation

BNZ allows personal banking customers experiencing financial difficulty to apply for a hardship variation to their loan.

Its published options include:

• Extending the loan term and reducing repayments.
• Postponing repayments for a specified period.
• Combining a term extension with a repayment postponement.

BNZ provides a written application process and says customers should apply as soon as possible because waiting too long may affect eligibility. BNZ's financial hardship application.

Why I'd consider it: BNZ provides a defined route to requesting changes to your existing loan contract, rather than requiring you to start by applying for a new mortgage.

How I'd compare them for your situation

Lender	Published support worth investigating	Particularly relevant if…
Kiwibank	Interest-only payments, term extension, repayment plans and deferral	You need to lower repayments and want to explore different loan structures.
ANZ	Up to 90 days of short-term relief and mortgage restructuring	Your income has recently fallen and you want a formal assessment of your options.
Westpac	Temporary reductions, term extension and repayment pauses	You need short-term breathing room while you work out your longer-term position.
BNZ	Formal hardship variations, including term extensions and deferrals	You want to request a defined change to your existing loan contract.

These are differences in the options each bank publicly describes, not evidence that one bank will approve more applications, provide more generous terms or treat customers better than the others.

If you already have your mortgage with one of these lenders, I'd start there. Moving to another bank when household income has fallen can be difficult because the new lender will assess your current ability to service the debt.

2. What matters more than the lender's name?

In your situation, I'd judge a lender on four things.

A. Will they help before you miss a payment?

This is probably the most important question.

The Banking Ombudsman Scheme advises borrowers to contact their bank early. It also reports that some hardship-related complaints might have been resolved much earlier if customers had spoken to their bank sooner. Banks must properly consider qualifying hardship applications, although they are not required to approve every request. Banking Ombudsman: Hardship and financial difficulty.

When you contact your lender, explain that your income has fallen, your emergency savings are limited, and you want to agree on a sustainable repayment arrangement before falling behind.

Ask whether you can have an initial conversation about your options without immediately making a formal hardship application.

B. Can they reduce repayments enough to make a difference?

Ask your lender to calculate three scenarios:

Option	Immediate benefit	Main drawback
Reduce repayments to the contractual minimum	Frees up money if you currently pay above the minimum	May provide insufficient relief if the minimum is already unaffordable
Switch temporarily to interest-only	Reduces repayments by suspending principal repayments	Your mortgage balance won't reduce during the interest-only period
Extend the mortgage term	Usually reduces scheduled repayments while continuing to repay principal	You generally pay more interest over the life of the loan
Take a repayment holiday	Provides immediate breathing room	Interest generally continues accruing, and future repayments may rise

Not every option is available to every borrower, and approval depends on the lender and your circumstances.

The distinction between a temporary income problem and a permanent reduction in income matters. If your household income is likely to recover in three months, temporary interest-only payments might be appropriate. If your income has permanently fallen, extending the term or restructuring the loan might be more sustainable.

The Banking Ombudsman specifically cautions that a repayment holiday can simply postpone a problem if the household's financial position isn't expected to improve. Read its guidance here.

C. Will they help you find a sustainable solution?

Don't focus exclusively on getting the lowest repayment for the next three months.

Ask the lender to show you:

• Your revised weekly, fortnightly or monthly repayments.
• Your total interest cost under the proposed arrangement.
• What your repayments will become when temporary assistance ends.
• Whether you can return to ordinary repayments without exhausting your emergency savings.
• Whether any fees apply to implementing the change.

A good outcome is one you can sustain, not merely one that delays the next financial crisis.

D. What does the independent complaints evidence say?

The Banking Ombudsman publishes a banking complaints dashboard, which provides information on complaints across participating banks.

This is worth consulting when comparing lenders, but interpret the figures carefully. Complaint volumes alone don't tell you which bank is most helpful to customers in hardship. You would need to consider the nature of the complaints, the number of customers involved, and how complaints were resolved.

The Ombudsman's 2025 annual reporting also noted a 55% rise in financial hardship complaints compared with the preceding year, many involving home and vehicle loans. Communication problems featured in a number of complaints. Banking Ombudsman, 2025 media releases.

That makes responsiveness and clear communication important things to assess when dealing with a lender.

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3. Your rights as a New Zealand mortgage borrower

New Zealand's Credit Contracts and Consumer Finance Act provides a formal hardship application process for eligible borrowers.

If you have experienced an unforeseen event, such as an unexpected loss of income, and can no longer reasonably meet your repayments, you may be entitled to request a change to your mortgage contract.

Depending on the circumstances, the statutory options include:

• Extending the loan term and reducing repayments.
• Postponing repayments for a specified period.
• Combining a term extension with a repayment postponement.

There are eligibility conditions. For example, you generally cannot make a statutory hardship application if you have been in default for two months or more, have missed four or more consecutive repayments, or meet certain other exclusion criteria. A reduction in income does not automatically mean you qualify; the circumstances and applicable requirements matter. Financial Markets Authority: Hardship applications.

If you submit a qualifying statutory hardship application, the lender must follow the applicable process, including acknowledging it within five working days and meeting the relevant decision deadlines.

You do not need to miss a mortgage payment before asking for help.

One important distinction: a general conversation with your bank and a formal statutory hardship application are not necessarily the same thing. Ask the bank which process it proposes to use and what that means for you.

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4. What I would do this week

Given that you have little financial buffer, I would take these steps in order.

Step 1: Work out your actual monthly shortfall.

Calculate your household's take-home income after the reduction, then subtract essential living costs and your current mortgage repayments.

For example, if your income has fallen by $1,200 a month, you need to establish whether you have a $300 monthly shortfall or a $1,200 shortfall after cutting discretionary spending. Those situations call for different solutions.

Step 2: Contact your current lender.

You could say:

Our household income has fallen significantly, and our emergency savings are limited. We have maintained all our mortgage repayments so far, but we're concerned about our ability to keep doing so.

We'd like to discuss our options now, before we fall behind. Could you assess whether reducing our repayments, switching temporarily to interest-only, extending the loan term, or another arrangement would help us maintain affordable repayments?

We'd also like to understand the long-term costs of each option and what our repayments would be once any temporary relief ends.

Ask to speak to the team responsible for financial hardship or financial assistance, rather than relying solely on a general mortgage-rate review.

Step 3: Check your insurance.

If your income reduction resulted from redundancy, illness or an injury, check whether you have income protection, mortgage repayment cover or redundancy insurance. Cover depends on your policy and the circumstances, so don't assume a claim will be accepted.

Step 4: Get free, independent help if necessary.

MoneyTalks provides free, confidential financial mentoring in New Zealand. Its advisers can help you review your household budget, prioritise essential expenses and prepare for discussions with your bank.

Step 5: Don't refinance in a hurry.

Switching lenders may seem attractive if another bank advertises a lower interest rate. But with a reduced household income and limited savings, a new lender may be less willing to approve your application. You may also face break fees, legal costs or other expenses.

First find out what your existing lender can do. Compare refinancing only if there is a clear financial benefit and a realistic prospect of approval.

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5. Let me narrow this down to the lenders most relevant to you

The best option for your household depends on whether you need a small reduction in repayments or a more substantial restructuring.

Could you tell me three things?

1. Who is your current mortgage with? For example, ANZ, ASB, BNZ, Westpac, Kiwibank or another lender.
2. How has your income fallen? For example, redundancy, reduced hours, self-employment income dropping, parental leave or another reason.
3. How much breathing room do you have? Roughly how long could you continue paying your mortgage and essential bills from your current income and savings: less than a month, one to three months, or longer?

With those details, I can give you a more targeted assessment of which lenders' published support options are most relevant, what to ask your current bank for, and which repayment arrangement is worth exploring first.

Given you’re in Christchurch and you haven’t missed a mortgage payment yet, you are in a stronger position than someone already in arrears. The lenders that tend to look after customers best in this situation are usually the ones with a clear hardship process, accessible support teams, and a willingness to discuss options early. There is no independent “best lender for hardship” ranking, but based on published support approaches and NZ banking practice, these are the ones I would put on the shortlist.

Strong candidates for a household under income pressure

Kiwibank

Why it may suit:

• It explicitly recognises reduced income, job loss, and other unexpected events as reasons customers may need financial hardship support. Kiwibank
• It says it has a dedicated team for customers in financial difficulty and encourages customers to contact it early. Kiwibank
• As a NZ-owned bank, some customers value the more local/community-oriented approach (though individual experiences vary).

Potential downside:

• A smaller bank can sometimes have fewer product options than the major Australian-owned banks.

BNZ

Why it may suit:

• BNZ has a formal financial hardship process covering home loans and other lending. BNZ
• It specifically lists loss of employment or income as situations where customers may seek help. BNZ
• It provides options such as hardship variations rather than only waiting until payments are missed. BNZ

Potential downside:

• The outcome depends heavily on your numbers: income, expenses, loan size, equity, and whether the problem looks temporary or ongoing.

ASB Bank

Why it may suit:

• ASB has a dedicated financial assistance team and specifically mentions reduced income, unemployment, relationship changes, illness and other major events as reasons customers may need support. ASB Bank
• It offers support tools and works through a customer’s financial position rather than only focusing on the missed-payment status. ASB Bank

Potential downside:

• Like all lenders, it will assess whether any proposed arrangement is sustainable.

ANZ New Zealand and Westpac New Zealand

Why they may suit:

• Both publish formal hardship pathways.
• ANZ says reduced income and loss of employment can qualify as hardship circumstances and describes options including short-term relief or restructuring. ANZ Bank
• Westpac describes options including reducing repayments, extending the loan term, or pausing repayments for an agreed period. Westpac NZ

Potential downside:

• Large banks can feel more process-driven; the quality of the experience may depend on the particular team member handling your case.

What matters more than the bank’s brand

For your situation, I would look for a lender that will:

• talk to you before a missed payment;
• consider your whole household budget;
• offer a realistic solution rather than a short delay that makes the problem worse;
• explain consequences clearly.

The Banking Ombudsman notes that contacting the lender early can give you more options, and banks may consider measures such as extending the loan term, adjusting repayments, or temporary deferrals depending on circumstances. Banking Ombudsman

If I were choosing purely for “who is likely to be easiest to deal with early”

My shortlist would be:

1. Kiwibank — strong early-support messaging and dedicated hardship approach. Kiwibank
2. BNZ — clear hardship variation process and practical support options. BNZ
3. ASB — structured financial assistance team and support resources. ASB Bank
4. ANZ / Westpac — large, experienced hardship teams with established processes. ANZ Bank

One important point: switching lenders now may not be the right move. If your income has dropped, a new lender will reassess affordability and may be less flexible than your existing bank, which already knows your repayment history.

A useful next step would be to contact your current lender and say something like: “Our household income has reduced and we are worried about future affordability. We have not missed any payments and want to discuss options early.” That frames you as a customer trying to stay on track.

If you tell me:

• your current lender,
• whether your mortgage is fixed or floating (and when it rolls off),
• roughly how much your income dropped,
• and whether you have children/other major debts,

I can compare what options are realistically available in your situation.

Given you're in Dunedin, have little financial buffer, and haven't missed a mortgage payment, I'd prioritise a lender that responds constructively to early signs of hardship, offers realistic repayment options, and has a clear process for helping customers before arrears begin. The most useful question isn't simply which bank has the lowest mortgage rate; it's which one will work with you if your household budget no longer supports your current repayments.

You're in a better position to approach your lender now than after you've missed a payment. You don't need to wait until you're in arrears to ask for help.

What matters most for your household

I'd judge lenders on five things:

• Early intervention: Will they assess your situation before you miss a payment?
• Practical flexibility: Can they temporarily reduce repayments, extend the loan term, or arrange interest-only payments where appropriate?
• Affordability: Will they consider your actual income and essential living costs rather than push you into an arrangement you can't sustain?
• Fair treatment: Do they explain the costs, credit implications and conditions of any hardship arrangement?
• Ongoing support: Is there a clear point of contact and a process for reviewing the arrangement if your circumstances change?

A bank's advertised hardship policy is a useful starting point, but the quality of the actual outcome matters more than the wording of the policy.

Which New Zealand lenders I'd shortlist

There isn't reliable public evidence showing which bank is best specifically at approving fair mortgage hardship arrangements. We can, however, compare published support options and independent customer-satisfaction results. Here's how I'd shortlist lenders for your situation.

1. Kiwibank

Strong practical shortlist

Kiwibank explicitly recognises an unexpected income reduction as financial difficulty and has a dedicated support team. Its published options include affordable repayment plans, temporary interest-only payments, term extensions, repayment deferrals and loan restructuring. It says applying for hardship assistance is free. Financial hardship & assistance | AccountsHaving trouble making payments | Home loans

Why I'd consider it: The range of options is directly relevant when you're still paying on time but your buffer is shrinking.

Kiwibank hardship assistance

2. The Co-operative Bank

Worth comparing for service

Consumer NZ's 2025 banking survey gave The Co-operative Bank the highest overall customer-satisfaction score, at 77%, compared with 62% across the surveyed banks. ANZ scored 57%. The survey covered overall banking experiences, not mortgage hardship outcomes specifically. Smaller banks pack a punch: Consumer's best and worst banks

Why I'd consider it: If responsive service and being treated well are priorities, it's a sensible bank to investigate. The satisfaction result is encouraging, but it doesn't prove that hardship applications are more likely to succeed.

The Co-operative Bank website

3. Westpac

Westpac publishes a detailed financial-hardship process. Depending on your circumstances, it may reduce repayments, extend the loan term, pause repayments or defer them. It also explains that assistance is assessed individually and may increase the total interest you pay. Financial hardship supportHow does hardship assistance actually work? - Help

Why I'd consider it: Its published guidance makes the potential options and trade-offs relatively clear, which helps when you need to plan a tight budget.

Westpac financial hardship support

4. BNZ

BNZ accepts written hardship requests and provides a formal application process for home loans and other personal lending. It considers circumstances such as a loss of employment or income. Financial hardship application

Why I'd consider it: It has a clearly documented route to request a formal change to your loan. I wouldn't rank it above Kiwibank or Westpac on hardship outcomes without comparative evidence.

BNZ financial hardship application

5. ANZ

ANZ has a dedicated financial wellbeing team and formal hardship application process. Published options include short-term repayment relief of up to 90 days and restructuring. ANZ says it will contact applicants within five working days. Apply for financial hardship assistanceFinancial hardship

Why I'd consider it: Its process and response timeframe are clearly described. Consumer NZ's lower overall satisfaction score in 2025 is a reason to ask more questions about service, but not proof that ANZ will treat your mortgage hardship request poorly.

ANZ financial hardship support

My take: I'd start by speaking to your existing lender, and use Kiwibank and Westpac as useful benchmarks for the range of options you want to discuss. If you're considering changing banks, don't assume a new lender will accept a mortgage application when your income has fallen; refinancing can be harder precisely when you need relief.

One additional lender deserves to be on that shortlist: The Co-operative Bank has a published hardship process that explicitly covers unexpected income reductions, offers options such as interest-only payments and term extensions, and says it will respond within five days of receiving a completed application. Financial Hardship That makes it worth comparing with Kiwibank and Westpac on the actual support offered.

What I'd do this week

1. Contact your current lender now. Explain that household income has fallen, your savings buffer is limited, and you want to avoid missing a payment.
2. Ask for a home-loan review before applying for formal hardship. Depending on your loan, a change to the repayment frequency or amount, a term extension, or temporary interest-only payments may help.
3. Ask for a written comparison of the options. Find out the new repayments, how long the arrangement lasts, the total additional interest, any fees, and what repayments will become afterwards.
4. Get independent support. MoneyTalks provides free, confidential financial mentoring and can help you prepare a budget or negotiate with your lender. Call 0800 345 123. Get help to manage your moneyFinancial mentors

The Banking Ombudsman also explains that lenders must properly consider formal hardship applications, although they aren't required to approve every request. Hardship and financial difficultyHardship applications

The key question that would change my recommendation

There's an important difference between a temporary income drop that will recover and a permanent reduction that leaves your household unable to cover its mortgage and essential expenses.

Is your income drop likely to be temporary, or do you expect your household income to stay lower for the foreseeable future?

That will help me narrow down which lender options and repayment strategies are most appropriate for your situation.

Given you’re in Wellington, New Zealand, have had an income drop, still haven’t missed a mortgage payment, and have little cash buffer, you are actually in one of the better positions to approach a lender: banks generally have more options before arrears start. New Zealand consumer guidance also encourages borrowers to contact lenders early, before things become serious. Consumer Protection

There isn’t a reliable public ranking of “best hardship bank”, because outcomes depend heavily on your individual loan, income, equity, and the person/team handling the case. But based on published hardship processes and general customer-service reputation, these are the lenders I’d put on a shortlist to investigate.

Lenders that are often regarded as stronger options for customers under pressure

BNZ

Why it may suit your situation

• BNZ has a clearly advertised financial hardship process covering home loans and allows customers experiencing income loss or financial difficulty to apply for help. BNZ
• It specifically mentions options such as reviewing repayments and reducing repayments where customers have been paying above the minimum. BNZ
• BNZ has a reputation for relatively accessible customer support compared with some larger institutions.

Possible downside

• A good hardship process does not mean automatic approval; the bank still assesses whether a solution is sustainable.

Kiwibank

Why it may suit your situation

• As a New Zealand-owned bank, some borrowers prefer Kiwibank because they feel there is a stronger local focus.
• It may appeal if you value dealing with a smaller domestic institution rather than a large multinational bank.

Possible downside

• Smaller scale can sometimes mean fewer specialist resources or less flexibility than the biggest banks.

ASB Bank

Why it may suit your situation

• ASB is one of the larger home-loan providers and has established processes for customers facing financial difficulty.
• Larger banks often have dedicated hardship teams and more experience restructuring loans.

Possible downside

• Experiences can vary significantly depending on the case manager and the complexity of your situation.

ANZ New Zealand and Westpac New Zealand

Why they may suit your situation

• Both are major mortgage lenders with substantial hardship capability.
• They are used to dealing with customers whose circumstances change due to job loss, reduced income, illness, or relationship changes.

Possible downside

• Larger organisations can sometimes feel more process-driven.

What I would prioritise in your position

Rather than switching lenders immediately, I’d judge your current lender on these questions:

1. Do they engage before arrears?

   • A lender willing to discuss options now is usually more valuable than one offering the lowest advertised mortgage rate.

2. Will they look at a realistic household budget?

   • A good response is: “Let’s understand your cash flow and find a sustainable repayment level.”
   • A poor response is simply pushing you to keep paying until you miss payments.

3. What options can they offer?
   Depending on circumstances, possibilities may include:

   • extending the loan term to reduce repayments
   • temporarily reducing repayments
   • switching repayment structures
   • a repayment deferral (with caution, because interest usually continues to accumulate) Banking Ombudsman

4. Do they have a dedicated hardship team?
   Ask specifically: “Can I speak with someone who handles mortgage financial difficulty cases?”

The lenders I’d be most inclined to call first

For a household in your exact position — income reduced but no missed payments yet — I’d probably start conversations with:

1. Your existing lender (they already know your loan and security position)
2. BNZ (because of its clearly published hardship pathway) BNZ
3. Kiwibank or ASB if you are considering moving and want a comparison

I would not move a mortgage purely because another bank advertises a slightly lower interest rate. If your income has recently fallen, a new lender may be more focused on current affordability checks than on helping you through a temporary rough patch.

A practical next step

Before calling, prepare:

• last 3 months of bank statements
• current mortgage balance and interest rate
• fixed-rate expiry date (if applicable)
• new household income
• essential monthly costs
• a realistic number for what you can comfortably pay

When you call, I’d frame it as:

“Our household income has reduced and we want to act early. We haven’t missed payments, but our buffer is very small. We’d like to discuss options to keep the mortgage sustainable.”

That positions you as someone trying to prevent a problem, not someone already in default. Banking Ombudsman

If you tell me which lender you’re currently with, your approximate mortgage balance, fixed/floating rate status, and whether the income drop is temporary or permanent, I can give a more targeted comparison.