13 Feb 2011

NAB cuts exit fee for home loan defectors

6:05 am on 13 February 2011

The mortgage war between Australia's big banks has ramped up with National Australia Bank offering to pay exit fees for people who switch their loan from two of its rivals.

NAB says it will pay the $A700 fee charged by the Commonwealth Bank and Westpac when homeowners change lenders.

NAB says abolishing the fee will increase competition between the big banks.

Federal Treasurer Wayne Swan has welcomed the decision, saying the sector needs that sort of competition.

"It's a good move," he said.

National Australia Bank owns the Bank of New Zealand.