Young workers given housing loan opportunity

THE Bank of South Pacific first-home ownership scheme offers young workers the option now to buy homes using their superannuation.
BSP chief executive Robin Fleming said this was a positive change because in the past, mostly older workers were able to get a housing loan.
Fleming told The National that the scheme’s low equity allowed for this.
“Workers are able to access part of their superannuation to raise the required equity for a first-home ownership scheme loan,” he said.
“This enables workers to purchase a house at a much younger age than was the case before.
“The equity requirement under the scheme is 10 per cent rather than 20 per cent – which is the normal requirement for standard housing loans offered by banks.
“Again, this means that they don’t have to wait as long before buying a house. The difficulty many Papua New Guineans faced in the past had been that they were unable to accumulate enough savings to put forward as equity for a housing loan.
“Often this would (happen) late in life and the term of their housing loan would be so short, the repayments would be too high for them to service their loan. Many will live in institutional accommodation all their working lives. In retirement, (they) have no asset to fall back on other than their superannuation.”