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Refinancing could be costly

Mortgage holders should carefully weigh up their options before shifting to a rival lender.

All the controversy over interest rate hikes and bank fees has resulted in an increase in refinancing enquiries. Those considering a change need to investigate all of the costs associated with refinancing.

My advice is to think before you leap.

It may take several weeks before all lenders put their rate and fee changes in place, including fixed rates, so until you know what the reshaped market looks like, the risk is that you make a costly decision.

ASIC’s new legislation, which requires banks to justify their exit fee charge, has added extra uncertainty to the mortgage industry and must be considered by consumers.

Exit fees are under scrutiny at the moment and even if you are looking to refinance with your existing lender, then it is definitely worth waiting to see what happens with these fees.

Be assured the banks will not loose out on profit. If they remove their exit fees they will make it up in some other area. I think the Labour  government needs to be careful what it wishes for as it is playing with fire. The opposition is on the right track more competition is needed.