Fees Made Easy
Fees made easy.
The skinny on the fine print.
When it comes to switching your loan, the fees you could be paying need to be on your radar. But if you know what’s coming it takes a lot of sting out of the tail.
Your previous lender may charge you an exit fee if you’re changing lenders, assuming that your original loan was taken out prior to July 2011.
Processing your loan takes some work, and the banks charge you for it. It varies from bank to bank – and some even waive it – but others charge as much as $800.
Lenders Mortgage Insurance (LMI)
This is to protect your lender if you default on your home loan rather than you. It’s only applicable if your loan poses a higher risk to the bank – typically when borrowing more than 80% of the purchase price.
The bigger the deposit, the smaller the fee.
If you have a fixed rate loan with your current lender, this covers any losses your old lender might face by you breaking your fixed term contract earlier than originally agreed.
Mortgage registration fees
These fees vary by state and territory. You may be charged a mortgage registration fee that lets the Titles Office know that your lender or type of loan has changed.
This is a state government tax (actually including transfer and mortgage duty, mortgage registration and transfer fees) on your property. How much you have to shell out depends on which state you live in and the price of your property. There are schemes for reduced stamp duty for first home buyers so ask your solicitor, conveyancer or broker if you meet the criteria.