Have rising interest rates got you thinking about refinancing your home loan? You’re not alone. Head of Research at PEXA, Mike Gill, has said that property owners are feeling the crunch of higher living costs due to inflation and rising interest rates. This has motivated many homeowners to review their loans and to look for a better deal.
Is refinancing right for you?
If you’ve had your loan for more than 12 months, or your financial situation has changed, it may be worth considering refinancing. Your decision will ultimately depend on your personal situation, but common reasons for refinancing include:
- Securing a lower interest rate on your loan.
- Accessing features such as an offset account or redraw facilities.
- Accessing equity in your home to renovate, invest or travel.
- Consolidating your debts, such as a personal loan or car loan, with your mortgage to make your finances more manageable.
What to consider when refinancing your home loan
When deciding whether or not to refinance your home loan, you will need to weigh up the pros and cons to make sure it is the right move for you. One of the key factors to consider is any upfront or ongoing costs associated with ending your current loan and switching to a new product. For example, if you’re on a fixed rate mortgage and decide to leave early, you may be charged a discharge fee and a break fee, which can be costly.
How to refinance your home loan
Refinancing is like applying for a home loan again, as you’ll need to provide all of your information and supporting documents to a lender. Keep in mind that it can take between four to six weeks to process and finalise a refinance application.
If you’re considering refinancing, make an appointment with our team. We can advise on what’s going to serve your best interests, and help find you a competitive home loan. We will also take care of the refinancing process on your behalf.
