Banks feel pain as angry home loan customers turn to smaller lenders

IT MAY have taken a set of outrageous pre-Christmas rate hikes but an angry mob of homeowners is on the move, following through on threats to ditch the big banks.

Australia's leading non-bank lenders have reported at least a three-fold increase in inquiries, the vast majority from customers looking to dump big bank home loans.

It's not only the major banks feeling the heat. Labor MPs are worried over the Opposition's attacks on the banks, which are resonating with the community.

The surge in demand has prompted one lender - Yellow Brick Road - to advance its branch expansion plans to cater for a flood of new customers taking advantage of its discounted variable interest rate of 7.34 per cent.

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