Considerations before refinancing

Considerations before refinancing

Review and Save with Refinancing

With today’s cost-of-living pressures, it’s crucial to regularly review your home loan to ensure it remains competitive. Refinancing can help you secure a better mortgage and save you money over the life of your loan.

Key Questions Before Refinancing

1. Cost vs. Benefit

Understand all the costs involved in refinancing and weigh them against the potential savings. Some costs to consider include:

  • Discharge fee from your current lender
  • Mortgage registration fee for your new loan
  • Fixed loan break fee if on a fixed-rate loan
  • Exit fee for breaking your loan term
  • Settlement fee with the new lender
  • Property valuation fee
  • Lenders Mortgage Insurance if borrowing more than 80% of the property’s value
  • Title search fee

2. Suitable Loans for Your Circumstances

Consider which type of home loan fits your financial situation and goals:

  • Fixed Term Home Loan: Lock in your interest rate and know your repayments for a fixed period.
  • Variable Home Loan: Benefit from potential future cash rate cuts.
  • Split Loan: Combine fixed and variable rates for more flexibility.

Also, think about interest-saving features like a redraw facility or offset account. Making larger or more frequent repayments can also help you pay off your loan faster.

3. Increasing Your Loan

Refinancing is an opportunity to top up your loan. Whether planning a renovation, buying an investment property, or getting a new car, refinancing can provide the extra funds you need.

4. Debt Consolidation

Consolidate multiple debts, such as personal loans and credit card debt, into your home loan. This simplifies your repayments but may increase the overall interest paid over the loan’s life. We’ll help you crunch the numbers to see if this is beneficial for you.

Refinancing Assistance

Refinancing isn’t suitable for everyone, but every borrower should consider it. As your mortgage broker, we can help you assess the pros and cons of refinancing. We’ll find you a competitive home loan that meets your needs, explaining fee differences, serviceability criteria, and turnaround times.

Get in touch today to learn more about refinancing and how it can benefit you.