Not all ‘exit’ fees have been banned!

Laine Gordon

By Laine Gordon

1 min read

One of the biggest reforms in the home loan market in recent years was the banning of “early exit fees” on variable rate mortgages. Up until last year, many lenders imposed conditions on their variable rate home loans that meant you paid a penalty fee if you wanted to repay the loan in full within a certain time frame – say three years. In effect, this meant some variable rate home loans combined the "worst of both worlds" – they offered no certainty on rates and therefore repayments, but had a "fixed term" element where you faced a penalty to exit.

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