Ban on exit fees officially passed into law
(25 March 2010 – Australia) The proposed ban on exit fees on mortgages has now become law, with Treasurer Wayne Swan labelling the ban a victory for Australian families.
The ban passed into law on Wednesday and will apply to all new home loans from July 1, 2011.
'This is an important day for consumers because one of the biggest roadblocks stopping Australians getting a better deal for their families will finally be removed,' Mr Swan said in a statement on Wednesday.
He said this critical measure would help boost competition in the home loan market over time, giving consumers greater freedom to walk down the road if their bank wasn't doing the right thing by them.
'Exit fees can be so high that they completely wipe out the savings from switching to a cheaper mortgage with another lender,' he said.
He said some major banks had already responded to this initiative by abolishing their exit fees, while National Australia Bank was even offering to pay exit fees for home owners to switch across from the two big banks that still have the fees in place.'
'This is an important day for consumers because one of the biggest roadblocks stopping Australians getting a better deal for their families will finally be removed,' Mr Swan said in a statement on Wednesday.
He said this critical measure would help boost competition in the home loan market over time, giving consumers greater freedom to walk down the road if their bank wasn't doing the right thing by them.
'Exit fees can be so high that they completely wipe out the savings from switching to a cheaper mortgage with another lender,' he said.
He said some major banks had already responded to this initiative by abolishing their exit fees, while National Australia Bank was even offering to pay exit fees for home owners to switch across from the two big banks that still have the fees in place.'
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