Thanks Marty,
Perhaps the question of whether the ban is a good one or otherwise should be raised as a separate thread in the Opinion forum.
However the issue raised by dbomber in this thread seems to be that he thought that break costs were exit fees, which of course they are. He also inferred that he thought exit fees were banned outright as the Government claimed they were when in fact they aren't.
Although dbomber seems to have disappeared (perhaps disheartened by the earlier posts), there is a basic legal argument that he is entitled to recover some or all of his break costs from the Government to the extent he has relied on its claim that Exit Fees were banned outright. There was also an earlier promise from the Government that ASIC will go after lenders that simply seek to rebadge exit fees, but of course their own legislation would probably make this quite difficult to do.
I am already working with borrowers like dbomber, who want to break their fixed rate loans and am quite optimistic that we will get a result. Of course this also extends to discharge fees on all loans since the so called ban came into effect.
Cheers,
Michael Lee
The OP would not be complaining if rates had moved in his favour.
Marty McDonald | Mortgage Experts
http://mortgageexpertsonline.com.au/
Phone MeMichael,
You are endeavouring to pass yourself off as an expert in a field you clearly have limited knowledge of.
Exit fees are what the legislation say they are. No more. No less.
I hope you are not taking money from people in return for your “services” as they will clearly lose their money.
I was wondering how you make a living too.
According to the SMH article you are a self funded retiree at 35. Jealous.
Marty McDonald | Mortgage Experts
http://mortgageexpertsonline.com.au/
Phone MeI'll come to the rescue………
IF you choose to break your agreed contract and 'exit' from a fixed rate term homeloan, you are liable to pay a 'break cost'. You get this whether your lender has no 'exit fee charges' or not, and you don't get break costs on a variable rate loan.
This is specified seperately in the loan contracts, and there is numerous literature available from both lenders and other sources that explain in very simple language what a 'break cost' is.
A discharge fee is considered a cost incurred for services, a break cost on a fixed rate loan is a cost incurred. An exit fee is not.
You still pay a 'break cost' to stay with the same lender if you were to switch to a variable rate loan – which of course shows it can hardly be classified as an 'exit cost'.
To play on words rather than reading a contract and reasonableness is political rather than financial I'm afraid.Now off to crack open a new Cab Sav……..
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