Greens back continuation of exit fee ban

Hopes by some mortgage brokers and non-bank lenders that the Government would not garner sufficient numbers in the Parliament to maintain a ban on mortgage exit fees appear to have been dashed, with the Australian Greens indicating their strong support.

The Greens’ only member in the House of Representatives and the party’s banking spokesman, Adam Bandt, said today the Greens would vote to keep in place the ban on mortgage exit fees due to come into force on 1 July.

Bandt said that while the Greens understood that mortgage brokers and some non-bank lenders were concerned about the ban, they had not mounted a convincing argument about why it should not remain in place.

“Consumer advocacy groups such as CHOICE, the credit unions and mutual societies and even the National Australia Bank have all said overturning this ban is not the way to go,” he said.

“Instead of focusing on exit fees, those advocating greater competition in the lending market should focus on how to get the cost of wholesale finance for smaller lenders down so they can compete with the big four banks instead of penalising consumers,” Bandt said.

He said the Greens would seek further reforms from the Government to improve non-bank lenders’ access to finance.