Loan-to-value restrictions and bank capital requirements have made it harder for landlords to get loans.

Property investors unable to borrow money from mainstream banks are turning to second-tier lenders to bridge the gap.

Banks have become more cautious about deals as their Australian parents' capital requirements increase.

Loan-to-value restrictions have also made it very hard for investors to get a loan for a property with a deposit of less than 40 per cent.

Reserve Bank statistics show that lending to investors has dropped from $1.15 billion in January 2015, to $961 million this year - just $7m of that with less than 20 per cent equity.

Andrew Bruce, president of the Auckland Property Investors Association, said banks had indicated they were getting enough deals submitted to them that they could pick and choose which to lend on.

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"It's incrementally harder to get things over the line."

But those who are determined to get a deal done are finding a way through.

Non-bank lenders and finance companies operate outside the Reserve Bank rules.

Jenny Campbell, chief executive of the Mortgage Supply Co, said lending offered by those channels was more expensive. But she said savvy investors who had decided they were getting a bargain in a deal were sometimes happy to pay more to be able to take the opportunity.

One lender catering to investors is Liberty Financial. It offers up to 80 per cent lending to first-time investors, with 70 per cent offered at the standard floating rate, and 10 per cent at a higher rate.

Chief executive Mark Collins said there had been demand for the product as banks were forced to turn investors away.

But he said high house prices were probably keeping a lid on the number of inquiries his company received, because it was harder for investors to find investment opportunities.

Another, General Finance, said it was getting more applications than it could fund, and was offering second as well as first mortgages.

Gold Band Finance offers funding of up to 90 per cent of an investment property's price, although deals are designed to be short-term.

Usually they are structured so the Gold Band loan is paid off within five years, at which point the purchaser can take the deal back to a mainstream bank.

First Mortgage Trust is also active in investor lending, although it will only go to 65 per cent loan-to-value.

Campbell said she had seen an increase in the number of loans written with a second mortgage behind them. "That was out of fashion for a long time because high-LVR loans were so easily available. In the old days, a bank might do 80 per cent and the second-tier lender 10 per cent to 15 per cent. We are seeing more of that."

She said some investors were turning to credit unions, which also operate outside the Reserve Bank rules. Peer-to-peer loans are another option - Southern Cross lends at rates of 7.95 per cent to 11 per cent while LendMe offers rates between 6.64 per cet for the lowest-LVR deals for borrowers with the highest credit ratings, to 15 per cent.

But some were eschewing existing properties entirely, and focusing their attention on buying new. Lending on new properties is outside the loan-to-value rules. "That's really attractive for investors and there is good buying available," Campbell said.

Bruce urged caution for those who were determined to buy outside the bank rules.

"Interest rates were 9 per cent in 2008. You would not have to get back there to put some pretty serious hurt on. People have been able to borrow about double and pay the same amount of interest. Rates would not have to go up too much before that starts biting."