Hijacked over mortgage fees
4:00 AM Sunday Apr 25, 2010 Banks are enforcing hefty fees for home-owners to roll over their fixed term loans, brokers say.
With most terms ranging from six months to three years, and mortgages split into two or three loans, some borrowers could pay thousands of dollars more to fulfil the Kiwi dream.
ASB Bank has tightened up on enforcing fees faced by every mortgage holder when resetting their rates, according to brokers.
And it appears other banks could be heading in the same direction with one mortgage broker reporting that Westpac has also applied stricter criteria on fees that were previously negotiable.
Kiwibank has also said the $100 fee being charged will rarely be waived.
Edge Mortgages broker Andrew McMacready said ASB Bank had met with a number of brokers to explain that it would now enforce the fees "as a matter of course".
An ASB Bank document obtained by the Herald on Sunday said it introduced the new fee schedule to "reflect the time and complexity in providing the best in customer service".
The fees would now apply from a series of dates between March and May.
While the document shows that the cost of the fees is reducing in some cases - from $250 to $50 - brokers say the customers will have a tougher time getting fees waived.
The only customers not having to pay fees for refixing a mortgage were those referred to as a "high value clients".
The bank said in the document that fees were required by law to be "fair" and represent the cost of handling a loan. It said the fees were changing to "fairly reflect the time and resources we allocate to client interactions".
The document also showed the ASB Bank was wiping a $500 contribution previously given to customers to help pay for legal fees.
ASB chief executive of retail banking Ian Park said the refixing fee was a "standard fee".
"Whether the manager charges it will depend on a number of things. But I would expect the fee to be charged," he said.
"But I expected it in the past. The only thing that changed is that we reduced the fee."
Financial expert Bernard Hickey said: "New Zealanders might be surprised to know that the big Australian banks are not happy with their New Zealand operations. All the major banks are under pressure to improve profits from their head offices in Melbourne and Sydney. This may be one of the moves they are taking to improve their profits."
MortgagePeople broker Janet Harris said Westpac was charging $250 for refixing a loan but customers who owed less than 80 per cent of the value of their home could get the fee waived.
But Westpac's general manager of retail banking Bruce McLachlan said staff were allowed to waive the fees.
He said: "I don't believe it's right to have a black and white approach. ... ASB are taking a totally different stance than what they have done in the past."
A Kiwibank spokesman said the bank had a set fee for refixing that would be charged "in normal circumstances".
An ANZ and National Bank spokeswoman said customers were not charged to refix mortgages. A BNZ spokeswoman said a two week "no fee" promotion had just finished. A fee of $150 was applied "case by case".
4:00 AM Sunday Apr 25, 2010 Banks are enforcing hefty fees for home-owners to roll over their fixed term loans, brokers say.
With most terms ranging from six months to three years, and mortgages split into two or three loans, some borrowers could pay thousands of dollars more to fulfil the Kiwi dream.
ASB Bank has tightened up on enforcing fees faced by every mortgage holder when resetting their rates, according to brokers.
And it appears other banks could be heading in the same direction with one mortgage broker reporting that Westpac has also applied stricter criteria on fees that were previously negotiable.
Kiwibank has also said the $100 fee being charged will rarely be waived.
Edge Mortgages broker Andrew McMacready said ASB Bank had met with a number of brokers to explain that it would now enforce the fees "as a matter of course".
An ASB Bank document obtained by the Herald on Sunday said it introduced the new fee schedule to "reflect the time and complexity in providing the best in customer service".
The fees would now apply from a series of dates between March and May.
While the document shows that the cost of the fees is reducing in some cases - from $250 to $50 - brokers say the customers will have a tougher time getting fees waived.
The only customers not having to pay fees for refixing a mortgage were those referred to as a "high value clients".
The bank said in the document that fees were required by law to be "fair" and represent the cost of handling a loan. It said the fees were changing to "fairly reflect the time and resources we allocate to client interactions".
The document also showed the ASB Bank was wiping a $500 contribution previously given to customers to help pay for legal fees.
ASB chief executive of retail banking Ian Park said the refixing fee was a "standard fee".
"Whether the manager charges it will depend on a number of things. But I would expect the fee to be charged," he said.
"But I expected it in the past. The only thing that changed is that we reduced the fee."
Financial expert Bernard Hickey said: "New Zealanders might be surprised to know that the big Australian banks are not happy with their New Zealand operations. All the major banks are under pressure to improve profits from their head offices in Melbourne and Sydney. This may be one of the moves they are taking to improve their profits."
MortgagePeople broker Janet Harris said Westpac was charging $250 for refixing a loan but customers who owed less than 80 per cent of the value of their home could get the fee waived.
But Westpac's general manager of retail banking Bruce McLachlan said staff were allowed to waive the fees.
He said: "I don't believe it's right to have a black and white approach. ... ASB are taking a totally different stance than what they have done in the past."
A Kiwibank spokesman said the bank had a set fee for refixing that would be charged "in normal circumstances".
An ANZ and National Bank spokeswoman said customers were not charged to refix mortgages. A BNZ spokeswoman said a two week "no fee" promotion had just finished. A fee of $150 was applied "case by case".
Disclosure documents, anyone? 
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