A Game-Changer for Property Investors
As of June 2025, there is a new 10-year interest-only mortgage option for eligible property investors in NZ. Yes – up to 10 years! A couple of banks have widened their options for interest- only mortgages. This is a significant move and game-changer for many property investors who are looking to optimise cashflow, reduce repayments, or strategically grow their portfolio.
But remember, if your situation does not meet the banks’ criteria for interest-only mortgage, that’s not the end of the road! We work with different reputable non bank lenders offering interest-only solutions for borrowers who need flexibility that banks can’t provide.
New 10-Year Interest-Only Mortgages for NZ Investors
A mainstream NZ bank now offers up to a maximum 10-year interest-only period for investment properties, provided you meet the key criteria:
Eligibility requirements include:
- Minimum 20% deposit
- Servicing assessed on a 25-year principal & interest term (P&I), or remaining P&I term, whichever is longer
- Strong credit profile and demonstrated rental income
Example:
A couple own two rental properties. With a new purchase planned at $850,000, they can now lock in a 10-year interest-only loan. This helps them keep repayments lower than if it were a principal and interest loan, and rental income covers interest costs and maintenance. Learn more detail about how an interest-only loan works.
In addition to the new 10-year interest-only for investors, another game-changer is the 2-year interest-only and principal relief for lifestyle reasons which we explore further:
2-Year Interest-Only and Principal Relief for Lifestyle Reasons
Another main bank has introduced interest-only and principal relief for lifestyle reasons for 24 months.
Lifestyle reasons include parental leave, travel, career break or property sale. As always, eligibility criteria apply. You don’t need to specify the reason in your request, but you must meet all the eligibility criteria, which includes:
- A good history of account conduct
- No history of a hardship-qualifying event
- No history of Principal Relief through Financial Assistance post October 2022
- Meeting the UMI (unallocated monthly income) affordability threshold
- Maximum LVR (loan-to-value ratio) of 80%
- Demonstrating the ability to meet loan repayments once the principal relief period has ended.
Example:
Both Jordan and Jennifer are taking a 12-month career break in their jobs to travel with their young children. They apply for and get approved to switch their loan to a 2-year interest only and principal relief period to free up cashflow.
Why Use 10-Year IO or 2 Year IO and Principal Relief?
This is a powerful option when used strategically to:
- Reduce monthly repayments
- Increase short-term cashflow
- Free up capital for renovation, lifestyle goals or investment
You Don’t Need to Find Answers, You Have Us!
Whether you qualify for bank interest-only offers or need a tailored solution through a non bank lender, we can help. At Platinum Mortgages, we take the guesswork out of it. We’ll review your full situation and then manage the application process for you and provide support for the lifetime of your mortgage. So, if you’re looking for a mortgage, reach out and let’s get you sorted.
Ready to explore the new NZ 10-year interest only option or short-term relief? Let’s chat today.
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Angela is an accredited Financial Adviser, licensed under FSP742251 and has been in the Financial Industry since 2006. Our 5-star Google reviews reflect the excellent customer experience we promise — making your home loan journey positive, stress-free, and rewarding. At Platinum Mortgages, our clients are the reason we exist — so you can be confident every step is guided by genuine care and expertise.