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Mortgage exit fees come down, for some

16/06/2010

Credit unions offer the best deal on mortgage exit fees, averaging $420, while the big four banks charge an average of $678. Finance companies charge the highest exit fees, averaging $1900 according to a new study by Ian Ramsay and Neil Ashton, of Melbourne University. The authors said the huge fees charged by finance companies may be illegal because they are so much more than the actual cost of terminating the mortgage.

"There were quite a number [of finance company mortgage exit fees] in the $4000 to $5000 range - and that's on a $250,000 loan," Prof Ramsay said. "It's nothing to do with the underlying cost of terminating the mortgage, from the financier's point of view." The big banks' average exit fee has fallen by $402 since 2008 said Ramsay.

Source: Herald Sun



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