Find mortgages with no on-going fees

What is a home loan with no ongoing fees?

Some home loan providers charge ongoing fees. A home loan with no ongoing fees is a mortgage with no recurring charges, such as monthly or annual account keeping fees.

While these types of loans may boast no ongoing fees, you may still incur mortgage application fees and other initiatory charges. If you miss repayments, refinance, discharge from or default on your loan, these actions could also attract additional fees.

Different fees for different loans

Generally, there are three types of home loan fees: upfront fees, ongoing fees and break fees. The type of fees you could be charged, and what they might cost, will depend on the lender you choose and the terms of the loan itself.

Some banks specifically offer home loans with no ongoing fees, while others offer loans that waive upfront fees. To decide whether a home loan with no ongoing fees is right for you, it’s important to consider a range of different factors that may affect your overall costs over the life of the loan.

For example, you might save hundreds or thousands of dollars by choosing a home loan that doesn’t charge one-off, upfront fees. However, these initial savings may be negated down the track if you’re paying ongoing account fees for the next 25-30 years.

Additionally, you may miss out on some benefits that are included in loans that charge ongoing fees.

What are ongoing fees?

There are a variety of different fees a lender can charge that could be considered ongoing costs. These include:

• Monthly service fees: These are associated with loan administration and servicing.
• Annual fees: Some loans, particularly those offered as part of a package deal, may incur annual fees associated with a lower rate of interest or other promotional offers.
• Late payment charges: If you don’t pay your monthly repayment on time, you may be charged a late payment fee. In some cases, a lender might provide some leeway and waive these fees.
• Redraw fees: Lenders may offer an offset or redraw feature that allows you to withdraw additional payments you've made during the loan duration. However, you may have to pay a fee for each withdrawal.

Compare your options

Checking a loan’s comparison rate can provide an indication of a home loan’s actual total costs. The comparison rate combines interest charged, fees incurred and other standard charges into a single percentage.

Looking at the comparison rates of two or more home loans can help you estimate, at a glance, which mortgages may end up costing you more or less money overall.

Checking with the provider and reading up on the mortgage’s product disclosure statement (PDS) can help you to ascertain exactly what fees and charges apply to the loan you’re researching and how much they could cost you.