Real Estate Exit Fees Soon To Be Banned

Buying a home is an expensive exercise initially as well as a great investment. Saving the deposit to put down on a home can take time. Then shopping around for the best deal on a home mortgage loan will need to be done and not in a hurried fashion. There are many lenders available and some are better than others, but as well as lending money they are in the business of making money. Always be aware of fees that are added into the loan such as stamp duty, administration or establishment fees, and make sure that with the added interest you can afford to keep up repayments.

Buying real estate is an expensive project, with not only the initial cost of the real estate, but the added outlay for establishing a mortgage incurring stamp duty, establishment fees plus the ongoing interest rates. There are a lot of online mortgage brokers who can help look for the best bank loans for people and have saved many people significant amount of cash over the loan period. Banks are well known for devising ways of deterring their customers from changing over to competitors who have more favorable terms. This is why they created exit fees to keep customers under their umbrella. And this is definitely a bad practice which do not favor the loaners.

Exit fees started out being called deferred establishment fees, which was the fee for setting up the loan when purchasing any real estate for example. The main purpose was the attract people that wanted to loan money for a home. This may have seemed attractive initially, but later could be seen for what is really was when the customer wanted to take up a better offer elsewhere. They were then expected to pay the amount of the establishment fees that had previously been waived at the start of the contract. This could be amounts which customers may not have had available to them in order to benefit from the opposition's lower rates.

But we need to thank for the intervention of the Federal Government and the Treasurer has now banned charging of “exit” fees. This will increase competition between the banks, especially the bigger ones. This ban will take place on the July 1st 2011, but only applies to new mortgages taken out. This is definitely a relief for those borrowers who can barely keep the balance on their budget due to loans. Overall this means a better deal for all borrowers.

----------------------------------------------------
Banks give home loans for real estate Werribee. Real estate Point Cook Investors Choice Property Management http://www.icpm.com.au/ can help to sell your home. Banks with real estate exit fees are banned from applying them to new loans after the end of June 2011.

EasyPublish this article: http://submityourarticle.com/articles/easypublish.php?art_id=198965