The couple’s mortgage application was denied because they spent $187 at Kmart

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A couple have recalled how their bank rejected their request for a mortgage extension due to a pre-Christmas shopping trip to Kmart.

Kim Anderson-Robb and her husband from Dunedin in New Zealand’s South Island are among those already stung by amendments to the Credit Agreements and Consumer Finance Act, which came into force on 3 December.

Aiming to protect vulnerable borrowers from loan sharks, banks are now monitoring applicants’ spending habits more closely before loans are approved.

Ms Anderson-Robb recently applied for an $80,000 ($A75,000) mortgage extension to help fund urgent repairs and renovations, including a rotting back patio and rewiring the house after the discovery of asbestos in the fuse box.

But his 17-year-old bank turned down the loan because of a recent one-time $187 trip to Kmart, another $100 shopping spree for Christmas gifts at discount variety chain The Warehouse and using a credit card she hadn’t used in over a year.

Kim Anderson-Robb was recently rejected for a mortgage extension by her bank due to amendments to New Zealand’s lending laws

Ms Anderson-Robb claimed bank staff told her they weren’t eligible for a mortgage top-up because the couple were ‘overspending’.

The daily purchase of a drink at the dairy by her husband while he was at work has also been questioned.

“We’ve had a mortgage for 17 years, we’ve never missed a payment, we’ve never taken a mortgage vacation, so I’d say we’re a very good customer,” a frustrated Ms Anderson-Robb told the Otago Daily Times.

“We have money, but they refused our application due to a one-time trip to buy Christmas presents and a bloody drink. It’s stupid.’

The support worker added that she had already had mortgage top-ups approved by the bank “without any problems”.

The couple have since decided to save up for urgently needed repairs to their home.

Kim Anderson-Robb and her husband have been rejected for a mortgage top-up following a $187 shopping spree at Kmart Invercargill (pictured)

Kim Anderson-Robb and her husband have been rejected for a mortgage top-up following a $187 shopping spree at Kmart Invercargill (pictured)

Ms Anderson-Robb feels sorry for potential buyers who may now find it difficult to enter the property market due to recent changes to lending laws.

“It’s so hard and I really, really feel for them,” she said.

Jason and Cindy Guild, a couple from Auckland, have also had their house-buying dreams shattered by the changed rules.

Their pre-approval for a loan was canceled in December, just days before they were to bid at an auction.

The couple were short on having a 20% deposit, but they had no debts, had no children and both had well-paying jobs.

“We thought this government was trying to put us in homes, but it seems that’s not the case,” Mr Guild said. Things.

“It went for $20,000 below what I was going to pay for it.”

Many would-be Kiwi home buyers are now struggling to enter the property market due to changes to lending laws which came into force on December 3 (stock image)

Many would-be Kiwi home buyers are now struggling to enter the property market due to changes to lending laws which came into force on December 3 (stock image)

New figures from Centrix released on Friday show the proportion of approved home loan applications fell from 36% to 30% over the past month.

Financial Advice New Zealand has requested an urgent meeting with the government to address industry concerns over recent changes to the Credit Agreements and Consumer Credit Act

Chief executive Katrina Shank said mortgage advisers are seeing a significant reduction in non-renewed pre-approvals and reduced lending levels to all borrowers due to the new requirements.

“Some of the stories almost defy logic, like being denied a loan or seeing the amount drastically reduced because you’re spending too much on coffees and takeout,” Ms Shank said in a statement.

“For many Kiwis, this all means they can no longer get a mortgage at the same amount of credit they would have been approved for before.

“We believe the intent of this legislation was not to reduce the availability of credit for the average Kiwi who was not vulnerable and could previously afford a mortgage.

Financial Advice New Zealand has requested an urgent meeting with the government to address concerns over changes to the law (apartments pictured in Auckland)

Financial Advice New Zealand has requested an urgent meeting with the government to address concerns over changes to the law (apartments pictured in Auckland)

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