Govt to outlaw exit fees
 
news

Govt to outlaw exit fees

By webmaster

The federal government has released a draft consultative paper outlining its plans to ban all exit fees.

The National Consumer Credit Protection amendments regulation paper calls for a blanket ban on exit fees for all lenders, not just banks.

In addition, the ban will apply to any fee payable at the time of repayment other than fixed rate break costs and discharge administration fees.

Gadens Lawyers partner Jon Denovan said the drafted regulation was “very worrying”.

“This will ban the collection of deferred establishment fees, capitalised account keeping fees, LMI recovery and interest equalisation fees to recoup honeymoon rates,” Mr Denovan said.

“This means that borrowers will have to pay many costs up front that are currently carried by lenders.  It will make refinancing much harder because of the cost.  Flexible product design will not be available in this country.”

promoted stories

Top Suburbs

Highest annual price growth - click a suburb below to view full profile data:
1.
BERKELEY VALE 46.03%
2.
EDGECLIFF 45.06%
3.
PAMBULA 43%
4.
EAST LISMORE 41.38%
5.
SOLDIERS POINT 37.89%
Govt to outlaw exit fees
SPI logo