Lenders fight hard for new business
Australian lenders are fighting harder to attract new customers by way of reducing fees or dropping them altogether, according to a new study by financial comparison website RateCity.
According to the study, the average cost of upfront and discharge fees has decreased between January 2011 and July 2012 ($34 and $49 on average respectfully), while the same period saw some lenders completely remove such fees from some of their products.
RateCity spokesperson Michelle Hutchison said the drop in fees was unexpected, which shows lenders are fighting harder to attract new business.
"We've also found some lenders have introduced 'fee-free' home loans such as Commonwealth Bank and Bankwest, while new players that have entered the market are offering no upfront fees such as LJ Hooker and UBank," Hutchison said.
"This shows that lenders are working harder to win over new customers by making it more affordable for prospective home buyers to enter the property market or for existing borrowers to switch," she added.
But not all lenders are playing the same game, with 81 home loans lifting their upfront fees (which now range from no cost to $1,000) since January last year, Hutchison said.
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