A new agreement has been thrashed out between banks and the NZ Government to allow Earthquake Commission (EQC) claims over $100,000 for mortgaged homes to be dealt with speedily.

The goal of the agreement is to ensure that rebuilding of the most seriously damaged houses goes ahead as smoothly as possible. The agreement ensures homeowners are not financially disadvantaged by changes to their mortgage resulting from an EQC payout.

A spokesman for the NZ Bankers Association told insuranceNEWS.com.au the banks are “pleased to have worked with the Government to support the people of Canterbury”.

Earthquake Recovery Minister Gerry Brownlee says between the EQC money being paid out and when it is spent on repairs, “bank customers will get the benefit, either in the form of reduced interest on their mortgage or interest earned if they choose to put it on deposit”.

“Banks will also absorb the early loan repayment costs when customers’ mortgages change as a result of an EQC payout,” he said. “This is a solution that will benefit all parties and gives certainty that homes can be rebuilt.”