NAB announces reforms to mortgage fees to benefit customers

25 November 2010

NAB announced today it would be the first major bank to remove some of its existing mortgage fees, for its NAB and Homeside mortgage products.

From early next year, NAB will remove or reduce some of its home loan fees including Prepayment fees, Redraw fees, and Default fees – or more than half of the fees currently charged to customers. This is in addition to already announced changes, including Early Exit Fee effective on December 6, 2010.

These benefits will apply to more than 500,000 NAB home loan customers.

Announcing the changes, NAB Group Executive, Personal Bank, Lisa Gray said: "We know that the variety of fees that can apply to home loans is often a source of frustration for customers – so we’re removing some of them.

“We have also reviewed our fee structure to reduce or standardise other applicable fees to make them easier for customers to understand. After these changes, NAB will have the most simple home loan fee structure and the lowest Standard Variable Rate of the major banks.

"Most importantly, we are not recouping these fees by increasing other fees.

“We know that these types of fees can add unnecessary stress to our customers and drive complaints, which is why we are simplifying them," Ms Gray said.

Overview of changes:

Effective from 6 December 2010

  • Abolish Repeat Statement, Duplicate Statement and Bank Cheque fees on all NAB and Homeside home loans;
  • Abolish Early Exit Fees on NAB Home Loans; and
  • Reduce Early Exit Fees on Homeside home loans to no more than $600. Where customers currently have an Early Exit contracted as less than $600, the contracted amount will still apply

Effective from 28 March 2011

  • Abolish NAB & Homeside home loan Prepayment fee, Redraw fee and Default fee;
  • Abolish 17 Homeside fees including loan modification and fixing fees; and
  • Reduce monthly service fees on the NAB 100% Offset and Introductory Rate home loans and NAB Home Equity Line of Credit products to $8.00 per month.

Over the last year, NAB has saved its customers more than $200 million from the changes it had already made to make banking fairer. Last year NAB was the first, and still the only major bank, to have abolished the most unpopular bank fees including the over-limit fee on all NAB credit cards and the overdrawn account fee on all NAB personal transaction and savings accounts.

Media contacts:

Melissa Clare, NAB Corporate Affairs – M: 0412 866 361