Mortgage shopping is now comparable: Swan

People looking for a home loan will find it easier to compare different banks’ offers with new regulations coming into effect on Sunday.

From January 1 all lenders will have to give mortgage information on a standard one-page key facts sheet.

The fact sheets will have to show the total cost of the loan, interest and fees.

The sheets break this amount down into the how much will have to be repaid for every $1 borrowed.

This means consumers can more easily compare the relative cost of a mortgage from a credit union with one from a big bank.

They also give information for variable rate loans about how much a monthly repayment would rise by if interest rates were lifted.

Treasurer Wayne Swan said the fact sheets would make it easier for people to get a better deal.

“It’ll mean less wading through paperwork and spending hours talking to different lenders to find out basic details families need to compare loans,” he said.

“We’re putting the power back in the hands of consumers and the big banks are now having to earn the loyalty of their customers.”

Combined with the ban on loan exit fees that started in July, these banking reforms would increase competition, Mr Swan said.

“Banks should be prepared to get into the ring and fight for their customers,” he said.

“If they don’t, then our changes mean their customers can walk down the road and get a better deal.”

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