Choosing the best bank for your home loan

• Things to consider when choosing a bank
• Comparing the major NZ banks
• The role of mortgage brokers
• Questions to ask before choosing a bank

For the most part, banks in New Zealand are a fairly similar bunch. Where one makes a move to differentiate themselves, the others are generally quick to follow suit. However, there are a few nuances worth exploring that could ultimately work in your favour.

The all-important interest rates. They play a big role in the cost of your home loan, and they’re influenced by things like the Official Cash Rate (OCR), economic conditions, and each bank’s own funding costs. You’ll usually choose between fixed rates (locked in for a set term), floating rates (which move up and down), or a split loan that blends the two. While it’s tempting to chase the cheapest rate, it’s not always the best option. Flexibility, break fees, offset or revolving credit features, and how long you plan to stay in the property can all make a slightly higher rate better value in the long run.

Banks can charge a mix of fees on home loans, including application fees, ongoing account or services fees and break fees if you end a fixed loan early. While these can seem small next to your total mortgage, they add up quickly and can change the true cost of your loan. 

Tip: Most banks let you add fees to your loan balance and pay them off over the full term. It sounds convenient, but it can get pricey. Those fees end up being amortised, which means you’ll pay interest on them for years. Many people don’t realise just how much extra they could be paying, so it’s worth covering fees upfront whenever you can.

Banks often offer cash back deals to entice you to switch. These can be a nice bonus, but they almost always come with conditions. The big one is the clawback period, usually 3 - 4 years. If you refinance or switch banks during this time, you’ll need to repay the cashback pro rata, which can run into the thousands. On the flip side, if you’re smart about timing and switch after the clawback expires, you can keep picking up these incentives and use it to pay down your loan faster (or book that trip to Fiji).

‘Special’ rates

Special interest rates are discounted rates offered to borrowers who meet certain criteria, usually having at least 20% deposit (80% LVR), meeting income requirements, and sometimes utilising specific banking products like salary crediting. They’re generally lower than ‘standard’ rates, but not everyone will qualify.

Home loans can come with a range of features that make managing your mortgage a bit easier or help you pay it off faster. Offset accounts let you use your savings to reduce the interest you’re charged, while revolving credit works more like a big overdraft you can dip into and repay as needed. Some loans offer redraw, letting you pull back any extra repayments you’ve made, while others allow lump-sum payments without penalty. And if you want flexibility, look for a loan that lets you make extra repayments whenever you like. The right mix of features can save you money and give you more control.

Customer service can make or break your home-loan experience. Quick approval timeframes are a big tick, especially if the pressure is on to make an offer on your dream home. 

Also consider how you like to bank. Are you likely to pop into your local branch, or are you quite happy dealing with the admin online and/or over the phone?

Tip: Check customer reviews and independent awards to get a sense of how each bank performs in the real world. Feedback from other borrowers can highlight both strengths and pain points, while industry awards signal consistent performance. BNZ won Canstar’s Most Satisfied Customers Home Loans Award, which is based on feedback from hundreds of everyday Kiwi about their experiences with their mortgage lenders.

Many banks now offer digital tools that make managing your home loan far easier day-to-day. Budgeting tools can help you track spending and plan ahead, while home loan dashboards give a clear view of your balance, repayments, and progress. It’s also handy to have quick access to statements for things like loan applications or tax time. And keep an eye out for rate-change notifications. A good app will alert you early so you can decide whether to refix, refinance, or ride it out.

Choosing a home loan provider is a huge decision. While it’s easy to focus on the interest rate, it’s just as important to check the fees, the digital experience, and how easy the bank will be to deal with when it’s time to re-fix.

Here’s a quick look at how the main players stack up (based on publicly available data as of 19 November 2025):

Rates: Offers competitive fixed-term special rates across popular terms. 

• Floating: 5.89% p.a.
• 1-year fixed: 4.49% p.a.

Discounts & fees: Known for sizeable cash-back offers, they are currently offering 1.5% cash back on new lending, capped at $30,000*. For the average NZ home loan of $588,000 this would mean an $8,820 cash back (assuming they meet eligibility criteria).

Service: Large national branch network plus mobile mortgage managers.

Digital experience: The app is functional for day-to-day banking (4.1 stars in Apple App Store) but some users say that self-service for mortgages (like making extra fixed-rate payments) can be limited and may require a phone call.

Rates: Consistently competitive on fixed-term special rates. 

• Floating: 5.99% p.a.
• 1-year fixed: 4.49% p.a.

Discounts & fees: Competitive cash-backs available. Currently offering first home buyers a minimum $5,000 cash back*.

Service: Reliable and generally consistent. Winner of the Canstar’s 2025 Bank of the Year Award, noting that the expert panel found ASB delivers outstanding value with low costs and great customer service.

Digital experience: Average app experience (3.2 stars in Apple App Store). Good for day-to-day banking, though reports are that its mortgage tools aren’t always as intuitive as others.

Rates: Strong across fixed-term options and often among the most competitive.

• Floating: 5.99% p.a.
• 1-year fixed: 4.49% p.a.

Discounts & fees: Currently offering a minimum $5,000 cashback for first home buyers*.

Service: Was voted No. 1 in New Zealand for Home Loan Customer Satisfaction (2025) (Source: Canstar).

Digital experience: Excellent app (4.8 stars on the Apple App Store). Users can easily change repayment settings, view savings impacts, and make extra payments instantly. Includes handy budgeting tools.

Rates: Often among the lowest for shorter fixed terms (e.g. 6-month and 1-year).

• Floating: 5.80% p.a.
• 1-year fixed: 4.49% p.a.

Discounts & fees: Offering $5,000 cash back for first home buyers*.

Service: Proudly New Zealand-owned. Generally well-regarded, but has a smaller branch network.

Digital experience: App experience is decent (3.2 stars in the Apple App Store), but mortgage self-service tools are less extensive than BNZ.

Rates: Frequently sharp on fixed terms, especially the popular 2-year rate.

• Floating: 6.09% p.a.
• 1-year fixed: 4.49% p.a.

Discounts & fees: Offering a minimum $5,000 cash back for first home buyers*.

Service: They have a network of Home Loan Experts who will come to you.

Digital experience: Strong app ratings (4.7 stars on Apple App Store), although some users report that the app is old and clunky.

Mortgage brokers play an important role in helping you compare lenders and find the right home loan for your situation. Instead of approaching each bank yourself, a broker can pull together options, explain the differences, and act on your behalf - often at no cost to you. They’re especially useful if you’re a first-home buyer, self-employed, or have a more complex application. If you’re weighing up going directly to a bank or using a broker, check out our guide on banks vs mortgage brokers, our advice on working with a mortgage broker in New Zealand, and our list of the best mortgage brokers in NZ.

• What’s the break fee if I want to change my loan structure?
• Can I make lump-sum repayments?
• What are your turnaround times for pre-approval?
• Do you offer offset or revolving credit?
• Do you negotiate on rates or fees?