Recent discounting moves by lenders are "acts of desperation", and will eventually disadvantage brokers and borrowers, a top broker has stated.

As lenders increasingly move to slash fixed rates in a bid to secure more mortgage business, Daniel O'Brien of PFS Financial Services has told Australian BrokerNews that growing discounts represent a desperate move on the part of lenders facing shrinking credit demand.

O'Brien has echoed the sentiments of LJ Hooker general manager Peter Bromley, who accused lenders of "desperate lending tactics". O'Brien called the current bank discounts "ridiculous".

"The reason I say the discounts are ridiculous is because longer term it will mean skinnier profit margins for the banks. The banks will then no doubt attempt to seek these losses from out of my pocket or the customer's," he said.

While O'Brien remarked that lender pricing wars have become widespread and possibly unsustainable, he said he had yet to see lenders relaxing credit standards.

"The banks are still definitely choosier that the pre-GFC days," he commented.