Reflecting on the fees charged on a clients home loan I thought I would look up the RBA to see if there was any info on how much bank fees had increased over the last decade.
What I found makes interesting reading in light of the massive cuts to local jobs and outsourcing to foreign countries the banks and other financial institutions have proudly touted as the reason we “Australians enjoy the best value for money banking in the world.”
From the Reserve Bank Of Australia, Statistical Tables:
Average home loan fee income per Australian Household.
1997 $302 per household
2008 $1045 per household
That is a 246% increase in 11 years. 22.5% per year!
I guess loans are bigger now, but this is fees, not interest.
If you are getting gouged by high home loan fees consider refinance.
Transaction account fees per Australian Household.
1997 $431 per household
2008 $1792 per household
That is a 315% increase in 11 years. 28.5% per year!
Increase must be for all the convenient services they offer? We are being gouged.
Credit Card Fees per Australian Household.
1997 $135 per household
2008 $332 per household
That is a 146% increase in 11 years. 13% per year!
Competition is keeping these fees under relative control.
Total bank Fees for all Accounts and Loans per Australian Household.
1997 $1160 per household
2008 $4845 per household
That is a 317% increase in 11 years. 29% per year!
So the big four major banks cry poor, do not pass on RBA interest rate cuts, increase home loan rates above RBA increases, continue to send jobs off shore and use 1950′s like lending practices. So much for CPI and the reasons we need high home loan rates. Bank fees are a catalyst, just like fuel costs, for bringing inflationary pressure to bear on home buying Aussie battlers. I say we need more competition in the banking sector.
Please check your loan statements for errors, I recommend you do it every month. If you get your statement six monthly, get access to transactions on-line and check them monthly. Fee income as you can see is a bounty for banks, don’t let them pirate more of your hard earned income than they are entitled too.
The RBA controls interest rates to an extent, and historically rates are not that volatile compared to other developed countries.
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