Interest rate break fees – Labour is kicking up a stink.

January 28, 2009 by
Filed under: Banks, Interest Rates, Credit Cards & Mortgages in NZ 

Labour leader Phil Goff says the Government is not treating the financial crisis as urgently as other countries, and has called for it to put pressure on banks to be flexible so people can escape high mortgage rates.

Wehey!

I blogged about this a while back:  the outrageous break fees that banks are charging to allow people to get out of high fixed rate mortgages. With banks such as Westpac charging the difference between your current rate and the wholesale rate – it’s a rip off of epic proportions.

So Phil Goff (current leader of the New Zealand Labour Party) is speaking out.

I really hope it makes a difference and someone somewhere listens to him. We can cope with the high rate on our mortgage – but there are many people who can’t. And to be honest I don’t see who on earth it helps for the banks to insist that people pay these high rates and go bankrupt. I mean – it’s not as if the banks are having much luck offloading their “Mortgagee sales”.

If a homeowner could hang on to their house by paying a mortgage at the lower rate, but is going down the gurgler paying nearly 9%, is it really in anyone’s interest to insist they can’t break the fee without paying a humongous penalty?

Now – I need to make clear – I am not suggesting that everyone should get away with ditching their high fixed rates because they can’t be arsed to pay their mortgage. Not at all – it’s just that these are spectacularly odd times – and I feel a little flexibility and perspective from the banks would not go amiss.

And if your bank is one of the ones being particularly vicious about this – and insisting on paying the difference between the wholesale rate – rather than the retail rate – Remember it. For a VERY long time. Because there will come a time when the cycle moves round and that very same bank will be begging you to give them your business. And you can take a great deal of pleasure in telling them where to stuff it.

funny-pictures-your-cat-is-also-making-a-list

Related posts:

  1. Interest rates in New Zealand – Investigation into rip-off break fees.
  2. ASB Interest rate changes – humph!
  3. Will New Zealand’s interest rates fall again this week?
«
»

Tags: , , , , ,

Comments

One Comment on Interest rate break fees – Labour is kicking up a stink.

  1. Interest Rates » Avalon’s Blog » Blog Archive » Interest rate break fees – Labour … on Wed, 28th Jan 2009 8:14 pm

    2. [...] Read the rest of this great post here [...]

Tell me what you're thinking...
and oh, if you want a pic to show with your comment, go get a gravatar!