Lending Terms and Conditions

These terms apply to any loan that we have provided to you after the effective date of these terms.

These terms are subject to any specific terms and conditions set out in any loan contract or any loan document we give you changing the terms and conditions of any loan you have with us.

We may change these terms at any time but must give at least 14 days’ notice before doing so.

Throughout these terms, we will use words that are in bold. These are words with specific meanings. The meanings of these words are set out in clause 26 of these terms. Also:

• “you” means each person named in a loan contract as a borrower or covenantor and if there is more than one, each of you separately and all of you together. “your” has a corresponding meaning.
• “you” also includes your executors and administrators
• “we” means TSB Bank Limited and our successors, assigns and authorised agents. “our” and “us” have corresponding meanings.

You agree to make the payments of principal and interest together with any credit fees and other charges set out in any loan contract you have entered into with us.

If we haven’t required payment beforehand, you agree to repay the loan on the repayment date.

If we have provided a loan to you but you have not entered into a loan contract with us in respect of that loan, you will repay the loan when we demand repayment. Until we make demand, you will pay interest on the loan at the variable rate. How often the payments are to be made may be requested by you but needs to be agreed to by us.

If we alter the interest rate we will be entitled to alter the amount of each of the payments payable under a loan contract to ensure that the amount advanced and interest payable under that loan contract is repaid over the same number of payments as set out in that loan contract. We may decide to extend the term of the loan and thereby alter the number of payments payable under the loan contract but we are not obliged to. If any default interest is required to be paid under the terms of a loan contract, we will be entitled to alter the amount of any payment or the number of any payments to take into account that default interest which is required to be paid.

You must pay all money that is payable to us no later than 4.30pm on the date that it is due. If such date is not a working day, payment is to be made on the next working day. If payment is not made by that time, we will have the right to charge default interest. Where you make any payment to us but you have other obligations to us which are overdue, we can apply any such payment to meet those obligations as we see fit.

If your loan is at a variable rate, then you can prepay all of the loan at any time. If you want to make a part prepayment of the loan, then you can do so at any time.

If your loan is at a fixed rate, then you can prepay on any payment date up to $10,000.00, each calendar year without incurring either a fixed loan prepayment fee or fixed loan prepayment interest.

However, if you want to prepay more than that amount in any calendar year, then you will be required to pay fixed loan prepayment interest, as well as a fixed loan prepayment fee as set out in the lending fees schedule.

You will repay the unpaid balance of your loan including all interest, credit fees and charges immediately upon demand being made by the bank. This clause
shall apply even if a loan schedule includes a repayment date or there is some other term in the loan contract which says otherwise.

This clause shall also apply even if the unpaid balance exceeds the overdraft limit or the revolving credit limit (if there is one). If demand for repayment is
not made by the bank under this clause, the loan will be repaid on the repayment date as set out in the loan schedule.

You must pay the credit fees and other charges as set out in any loan contract that we enter into with you. We can change the amount of any credit fees by giving you no less than five working days’ notice by sending you a disclosure statement or by advertising the change at least once in a daily newspaper that is published in New Plymouth, Auckland, Wellington and Christchurch and displaying the change at our branches and posting the change on our website.

We can debit any credit fee or cost that is payable by you to any of your loan accounts.

General requirements
You must keep all secured assets insured at all times for the full replacement value or such other amount as we may reasonably require. Your mortgage or other security interest sets out what type of insurance cover is required. Your insurance must be with an insurance company approved by us.

You must keep all such insurances in place until you have repaid all amounts owing to us.

Our interest as mortgagee or otherwise as a secured party, is also to be noted on any insurance policy.

You must provide us with a copy of your certificate of insurance if we ask for it.

Mortgage redemption insurance
If one of the secured assets is a unit titled property, we may require mortgage redemption insurance. If we require such insurance, the insurance policy must be to a level of cover with an insurer approved by us and in our name as insured party.

What about builder’s risk insurance?
If any building works are being carried out on any property you own which has been mortgaged to us, you must take out builder’s risk insurance with an insurer approved by us during the period of any construction. Our interest as mortgagee must also be noted on the policy.

We can ask you for extra security or require you to repay all amounts owing, or in the case of a revolving credit loan or overdraft loan, cancel your ability to borrow more money and reduce the revolving credit limit or overdraft limit if:

• you do not pay any amount when it is due under any loan contract or any other loan document;
• you are not, or any guarantor is not, complying with these terms;
• we have released any security we held and we need replacement security for your loan;
• something happens (whether by your actions or not) that we think adversely affects your ability to continue to meet your obligations under these terms or any loan contract or any guarantor’s ability to meet any guarantee obligation;
• something happens (whether by your actions or not) that we think adversely affects the value of any secured asset, or our ability to enforce any security;
• a guarantor tells us they are terminating or withdrawing the guarantee they gave us as security for your loan; or
• you are in default.

You must tell us immediately if you become aware of any reason why we might be able to require you to repay early (giving full details of it and any steps taken or to be taken as a result).

We can review the total amount that we have made available to you under all loan contracts you have with us at any time.

If you sell or change the ownership of any of the secured assets, you agree to repay all money owing to us which is secured by that asset except where we have agreed in writing not to require such payment.

When you have asked us to lend you money, you have provided certain information to us. We have relied on that information provided by you as being correct. The accuracy of that information has affected any decision that we have made to lend money to you. The accuracy of that information is therefore important to us.

You warrant to us that:

• you are able to enter into and perform all of your obligations under any loan contract you enter into or have entered into with us;
• your obligations under those loan contracts are legal and enforceable;
• the information that you have provided to us is correct and you have not omitted to tell us anything that would otherwise make that information untrue or misleading;
• except if you have told us otherwise, no person has made a claim against you or to your knowledge has threatened to make a claim against you which might result in a material adverse change to your business or your financial position;
• there are no security interests or any other of any nature affecting the secured assets which may adversely affect the value of any secured interest that you have provided to us;
• you are solvent.

You agree to:

• notify us immediately if you are in default or you think that there is a risk of you going into default;
• comply with all laws and regulations that may apply to you and any secured assets;
• if you are a company or have entered into a loan contract for business purposes:
  • you agree to keep and maintain proper records and books of accounts; and
  • you agree to provide us no later than three months from the end of each financial year a balance sheet and profit and loss account audited (if requested by us) for that financial year and, as and when requested by us, any financial information relating to you or your business affairs that we may reasonably request.
• if you are a company, you agree to keep your company registered under the Companies Act 1993 and you will not without our prior written consent, make any distributions or merge, consolidate with any person, liquidate, enter into administration, wind up or dissolve or cancel, redeem or reduce your capital.
• not without our prior written consent:
  • materially alter your business;
  • do anything or allow anything to be done which would adversely affect the secured assets in any way; and
  • dispose of any secured assets other than in the ordinary course of business and on ordinary arm’s length commercial terms for proper value.

We have obligations to protect our staff and customers against harm to their health and safety. When dealing with us, you agree that you will not engage in
any conduct or use any language that is abusive or intended to intimidate or harass.

You also agree that you will not be involved in any criminal activity of any nature that may adversely affect our interests.Where we have requested a valuation
report, that report is to be completed by a registered valuer that is satisfactory to us. The valuation is also to be addressed to us.

We are entitled to go directly to valuers, quantity surveyors and any other consultants as we may think necessary and request information and reports relating to any of the secured assets. The charges of all such information and reports will be paid by you immediately when we ask. You authorise all such consultants to provide the information and the reports requested by us.

Where we have requested a valuation report, that report is to be completed by a registered valuer that is satisfactory to us. The valuation is also to be addressed to us.

Where a valuation report has previously been provided, we may request an original of that valuation report to be re-addressed to us prior to drawdown of any loan.

Prior to the repayment date, we may advance and re-advance money to you under an overdraft loan.

We will charge a service fee calculated on the difference between the daily unpaid balance of the overdraft loan and the overdraft limit which will be debited on the last day of each month. If the account is in credit, the service fee will be calculated on the overdraft limit.

The terms of the overdraft loan may be reviewed by us at any time.

Prior to the repayment date, we may advance and re-advance monies to you under a revolving credit loan.

We will charge either:

• a drawdown fee charged on each advance made to you. The drawdown fee will be prescribed by us from time to time and will be debited on the last working day of each month; or
• a management fee as prescribed by us from time to time which will be debited on the last working day of each month.

The terms of the revolving credit loan may be reviewed by us at any time.

If you have entered into a loan contract as a trustee of a trust, you certify to us:

• you are able to enter into the loan contract and to grant any security interests required by the loan contract, under the terms of the trust document or under the Trustee Act 1956 and any trustee resolutions or other authorisations that may be required have been obtained or passed prior to the signing of the loan contract to ensure that it is legally binding.
• you have properly signed the loan documents in accordance with the terms of the trust;
• that your entry into the loan documents is for a proper purpose and for the benefit of the trust.

The terms of the loan contract will bind you personally unless you are an independent trustee. An independent trustee is a trustee who does not have any right to, or interest in, any of the assets of the trust except in a capacity as a trustee of the trust.

If you are an independent trustee, we will be entitled to recover any unpaid balance from your personal assets if we are unable to recover any unpaid balance from the assets of the trust because your certifications were incorrect. Even if your certifications were incorrect, we will only be entitled to recover from your personal assets the amount we would have recovered from the trust assets had your certifications been correct.

If you are not an independent trustee, we may recover any unpaid balance from your personal assets as well as the trust assets. If you have entered into a revolving credit loan or an overdraft loan as a trustee of a trust, you indemnify us against any claim against loss suffered by the trust that results from the operation of the revolving credit loan or overdraft loan by any party authorised by the trust.

If you are a company and you have entered into a revolving credit loan or an overdraft loan and you have authorised or may in the future authorise a party (“authorised party”) to draw on such revolving credit loan or overdraft loan from time to time, you indemnify the bank against any claim that may be made against the bank for any loss of any nature that may be suffered by the company or any shareholder relating to or as a result of the operation of the revolving credit loan or overdraft loan by the authorised party.

You agree that we can provide information in writing to you, including any information that needs to be disclosed to you under the Credit Contracts and Consumer Finance Act 2003 to you in electronic form and by means of an electronic communication.

You also agree that we can provide information to you by way of the bank’s website.

Any notice or demand under a loan contract or authorised by the Property Law Act 2007 may be signed by us or by our agent and served:

• by giving it to you personally; or
• by posting it by registered post or sending by courier addressed to you at your main place of business or your home address last known to us; or
• by giving it in electronic form and by means of an electronic communication under the Electronic Transactions Act 2002; or
• in the case of a company, by delivering it to a director of the company, by delivering it to an employee of the company at the company’s head office or principal place of business, or by leaving it at the company’s registered office.

A notice or demand will be properly served:

• if served personally, on the same day that it is given to you; or
• if posted by registered post or sent by courier, when the notice or demand would normally have been delivered and confirmation of delivery by New Zealand Post or the courier firm will be evidence of service; or
• if given in electronic form by means of an electronic communication:
  • at the time the electronic communication enters your designated information system (as defined in the Electronic Transactions Act 2002); or
  • at the time the electronic communication comes to your attention; or
  • otherwise, when actually received by you or your agent.

The posting, delivery or giving of a notice or demand shall be valid, even if at the date of service, you, whether to our knowledge or not, are dead, mentally incapable, bankrupt, in liquidation or absent from New Zealand or do not receive the notice or demand and despite anything else which might otherwise negate valid service.

The ways of service set out in this clause do not limit any other lawful mode of service.For the purposes of this clause, “registered post” includes any service that provides a system of recorded delivery and is similar in nature to a registered post service provided by a person as a postal operator under the Postal Services Act 1998.

We can at any time deduct from any account that you have with us, any amount that is overdue. We can do this even if you do not want us to.

By entering into a loan contract with us, you authorise us to collect, use and provide information about you for any purpose relating to your relationship with us and you authorise any other person to disclose information to us for that purpose. We do not need to first ask your permission each time we collect, use or provide information about you.

However, under the Privacy Act 2020, you have the right of access to and correction of personal information held by us.

If any parts of these terms are unenforceable then that does not affect the other parts and we can still enforce those other parts against you.

• If we do not exercise or if we delay the exercising of any of our rights under a loan contract or any other loan document, that will not prevent us from exercising those rights at some other time.
• We can, without your consent, assign any or all of our rights under a loan contract or any other loan document.
• However, you may not, without our consent, assign any of your rights or obligations under any loan contract or any loan document.

The following words have the following meanings in these terms and in any loan contract we have with you:

bank: means TSB Bank Limited

borrower: means the person referred to as borrower in any loan contract and is also referred to as “you” and “your”

charges: means any costs or payments of any nature which you are required to pay under any loan contract, loan document or these terms.

covenantor: means the person referred to as covenantor in any loan contract and is also referred to as “you” and “your"

daily interest rate: means the interest rate divided by 365

credit fees: means the credit fees set out in the lending fees schedule

date of advance: in respect of each loan contract is the date that the first drawdown is provided by the bank to you

default: means a failure:

- to pay an amount when it is due to be paid by you; or

- to otherwise comply with or perform any obligation which you have agreed to perform under these terms

default fees: means the default fees out in the lending fees schedule

default interest: means interest payable at the default rate

default rate: means the rate at which default interest is payable as set out in any loan contract

disclosure date: means the date that disclosure under the Credit Contracts and Consumer Finance Act 2013 is made to you

disclosure statement: means a statement providing the necessary information to you as required by the disclosure provisions of the Credit Contracts and Consumer Finance Act 2005

drawdown fee: has the meaning given to that term in the lending fees schedule

fixed rate: means the rate where the rate of interest is fixed for a fixed period

fixed loan prepayment fee: has the meaning given to that term in the lending fees schedule

fixed loan prepayment interest: has the meaning given to that term in the lending fees schedule

fixed rate term: means the period during which the interest rate has been fixed at a fixed rate

general security agreement: means an agreement that creates or provides for a security interest over all of the assets of the party signing the agreement

guarantee: means a separate form of deed of guarantee entered into by a third party in favour of the bank as a security

guarantor: means a person that has executed a guarantee

initial disclosure statement: means a statement provided to you prior to you entering into a loan contract providing the necessary information to you as required by the disclosure provisions of the Credit Contracts and Consumer Finance Act 2003

initial unpaid balance: means, in respect of each loan, the balance owing at the time of entering into that loan contract

instalment loan: means a type of loan where the amount of principal in each payment remains the same throughout the term of the loan. However, the interest portion of each payment will vary depending upon the interest rate that applies and the amount of principal still owing

interest: means the interest payable by you under a loan contract

interest rate: means the rate of interest payable on any loan as set out in the relevant loan contract

lending fees schedule: means the document provided by the bank which sets out the credit fees and other charges applicable from time to time

loan: means a loan provided to a borrower by the bank

loan contract: means any contract setting out the terms of a loan provided by the bank

lien over account: means an agreement that creates a charge over money in a particular bank account

loan document: means a loan contract, mortgage, general security agreement, specific security agreement, lien over account, guarantee and any other document entered into by a borrower or covenantor relating to a loan

loan schedule: means the schedule(s) attached to the loan contract setting out the terms of each loan

management fee: has the meaning given to that term in the lending fees schedule

mortgage: includes:

- any charge over property for securing payment of amounts or the performance of obligations; and

- any registered mortgage

overdraft limit: in respect of an overdraft loan, means the total amount that you can borrow

overdraft loan: means a loan made available to a borrower that provides for a borrower to borrow, repay and re-borrow amounts up to an overdraft limit

payment dates: means the dates that you are required to make payments as nominated by you and agreed to by us

person: means an individual, firm, company, corporation, an association of persons (whether corporate or not), trust, or governmental agency and any other entity (in each case, whether or not having a separate legal personality)

principal: means all amounts advanced to you by the bank

repayment date: means the date set out in any loan contract that all monies are required to be repaid by

revolving credit limit: in respect of a revolving credit loan, means the total amount that you can borrow

revolving credit loan: means a loan made available to a borrower that provides for a borrower to borrow, repay and re-borrow amounts up to a revolving credit limit

security: means each security interest described in a loan contract including any guarantee given as security in connection with a loan

secured assets: means property of any nature which has been charged in our favour to secure obligations

security interest: means any mortgage, general security agreement, specific security agreement, lien over an account or other charge

service fee: has the meaning given to that term in the lending fees schedule

specific security agreement: means an agreement that creates or provides for a security interest over specific assets of the party signing the agreement

table loan: means a type of loan where the amount of each payment throughout the term of the loan remains the same unless there is a change in the interest rate

term: means the period of a loan

these terms: means these loan contract terms

upon demand: means demand being made by notice in writing and served on the borrower in the manner set out in these terms

variable rate: means the housing variable interest rate prescribed by the bank from time to time

working day: means a day (other than a Saturday or Sunday) on which registered banks are open for general banking business in the province in which the act is to be done

unpaid balance: means in respect of a loan, the amount owing from time to time

upon demand: means demand being made by notice in writing and served on the borrower in the manner set out in these terms

variable rate: means the housing variable interest rate prescribed by the bank from time to time

working day: means a day (other than a Saturday or Sunday) on which registered banks are open for general banking business in the province in which the act is to be done

Throughout these terms, we refer to various statutes. Those references include regulations made under those statutes and any amendments to those statutes or regulations and any new ones which replace those statutes or regulations.