Home loan refinancing

When struggling to keep up with loan repayments or just wanting a better deal to save money, refinancing your home loan is a good idea.

Staying with your current lender

If you want to switch home loans, you’re most likely looking for lower interest rates. However before switching, let your current lender know that you’re looking for another home loan. They may offer to give you a better deal with lower interest rates, as they want to keep their clients.

Remember to compare their offers with loans you’ve found elsewhere, and consider both the interest rates and length of the loan. Having a lower interest loan for a long period of time may not end up saving money.

“If you have less than 20% equity in your home, you might have to pay lender’s mortgage insurance (LMI). This can increase the cost of switching and outweigh the savings you’ll get from a lower interest rate. If you decide to switch, ask for a refund of some of the LMI from your current loan.”

Comparing home loans

Get in touch with us, or Ha mortgage broker for help on comparing the fees and charges of various home loans. An alternate option is to use comparison websites, however they can sometimes be biased. If you do choose to use a comparison website, check out what to keep in mind.

Here are the fees and charges to compare:

Fixed rate loan	If you are on a fixed rate loan, you may need to pay a break-fee
Discharge (or termination) fee	A fee when you close your current loan.
Application fee	Upfront fee when you apply for a new loan.
Switching fee	A fee for refinancing internally (staying with your current lender but switching to a different loan).
Stamp duty	You may be liable for stamp duty when you refinance. Check with your lender.