Lender dangles switching carrot

by Adam Smith05 Feb 2013


A non-major is ramping up incentives to borrowers who change lenders with an offer of $750 toward their switching costs.
Citibank has said it will refund $750 toward the switching costs of customers who apply to refinance their current home loans to the bank. The offer runs from 4 February to 30 April, and applies to loans settled by 28 June.
Belen Lopez Denis, the bank's head of marketing, product and strategy for mortgages, said one of the single biggest objections consumers have to switching lenders are the fees involved.
"Our new offer provides an opportunity for brokers and customers to make switching easier," she said.
The promotion follows the bank's introduction of a six-month fixed rate product, starting at 5.24%. Lopez Denis said the switching incentive can be used in conjunction with the lender's new fixed rate product.
"This is the only six-month fixed rate in the market, designed for borrowers who don’t want to lock themselves into an inflexible loan if they believe more rate cuts are likely this year. Borrowers can lock in at a very low, very competitive rate immediately and move back into a variable rate if rates fall again," she said.
She said the bank was also offering a free 60-day rate lock after application.