Home loan refinancing can unlock your financial future
The benefits of refinancing your home loan are not just limited to saving you hundreds in monthly mortgage repayments.
By making the right choices and working with a mortgage broker, you can take a giant leap towards achieving your long-term financial goals.
The pros of refinancing a mortgage
- Get a cheaper interest rate and lower your monthly repayments.
- Reduce your overall loan amount so you can pay off your loan faster and maximise your available equity.
- Access equity to buy an investment property, renovate, build and more.
- Bring your high-interest debts like credit cards, personal loans and car loans into a debt consolidation home loan.
- Save your home if your mortgage is currently in arrears.
- Refinance from a specialist lender back to a major lender after you’re past your bad credit issues.
- Take advantage of tax benefits.
- Refinance to a home loan product that helps you pay off your home loan faster.
There is a short window of opportunity you can take if you want to refinance your home loan during the coronavirus pandemic.
Discover more below or, better yet, why not call us on 1300 889 743 and find out if you’re in a position to refinance your home loan?
You can also fill in our easy online enquiry form to start the home loan refinance process today.
Reduce your monthly mortgage repayments
Let’s say you have $500,000 owing on a 30-year home loan paying 4.20% per annum.
You’re currently paying $2,445 a month in mortgage repayments.
Using the home loan repayment calculator, if you were able to refinance to a rate of 3.59% p.a., you would lower your monthly payments to $2,270.
This will save you $63,000 over the life of your home loan.
Reduce your mortgage balance
By refinancing to a sharper interest rate, you’re reducing your overall interest bill and, therefore, your total home loan balance.
It also means that your loan amount compared to the current value of your property (LVR) will be even lower than before you refinanced.
This puts you in a powerful position as a borrower and a homeowner for two reasons:
- You can release equity a lot sooner than if you continued to pay your current interest rate.
- You can maximise your return on investment should you decide to sell the property.
Release equity to achieve your financial goals
The sharper your interest rate, the lower your overall loan balance and the more equity you available to release.
This opens up a world of property investment opportunities because you can use that equity as a property deposit.
You can even:
- Fund the cost of renovations.
- Fund the purchase of vacant land for future construction.
- Cash out, depending on the amount and purpose, such as going on a holiday or purchase a family car.
Consolidate high-interest debt into a low-interest home loan
Debts getting out of hand?
Do something about it now and avoid heartache like signing a Part 9 debt agreement.
You can refinance to consolidate your debts into one cheaper monthly mortgage repayment.
Save thousands and pay off your debts faster then if you were to continue to try and manage multiple payments at once.
You can consolidate many different types of high-interest debt facilities including:
- Credit cards.
- Personal loans.
- Car loans.
- ATO debts.
Save your home if your mortgage is in arrears
Major life events such as injury, illness, job loss or the death of a love one can prevent you from meeting your financial commitments.
Refinancing is a solution that can actually save people from losing their homes if their mortgage is in arrears.
Usually, you’ll refinance to a specialist lender (sometimes referred to as a non-conforming lender) for 1 to 2 years.
Some specialist lenders do not look at your credit history at all and assess your mortgage application based on its merits. The disadvantage is that you may get a higher interest rate but refinancing can save you from paying this higher cost forever.
Get out of a high-interest bad credit home loan
Are you currently paying off a mortgage with a specialist or non-conforming lender?
In as little as 6-12 months, you can refinance back to a major bank or lender at a much sharper interest rate.
Good mortgage brokers know this but don’t expect your specialist lender to tell you this!
The key to refinancing to a standard interest rate is that you have a steady income and have been making your home loan repayments on time, every time since getting your bad credit home loan.
You’ll need to meet other qualifying critieria so speak with one of our specialist mortgage brokers by completing our online enquiry form or by calling 1300 889 743.
Refinancing to get potential tax benefits
If you refinance to access equity in your home and use those funds to invest in property, shares or other wealth-building opportunities, you may be able to take advantage of negative gearing and depreciation benefits.
Let’s say you spent $50,000 on renovating your investment property, you may be able to claim depreciation on these costs over the life of the loan.
Please note that it is recommended that you speak to a tax professional to find out exactly how many deductions you will be allowed.
Find a home loan that best suits you
Most Australian homeowners have the wrong home loan features or have “bells and whistles” that aren’t being used effectively but are still costing them hundreds in bank fees.
By refinancing, you can get the right home loan product that will help you pay off your home loan faster.
You can learn even more about the home loan products and features available to you by refinancing with a mortgage broker.
They’ll provide a guide on:
- Fixed rate home loans.
- Variable rate home loans.
- Split mortgages.
- Rate tracker home loans.
- Professional packages.
- Basic home loans packages.
- 100% offset accounts.
- A Line of Credit (LOC).
- Flexible repayments: This allows you to make extra repayments at zero additional cost so you can pay the loan off quicker.
- Repayment holiday: This facility lets you take a break from making repayments if you change jobs or apply for extended leave from work such as taking maternity leave. Certain lenders may also let you make reduced payments instead.
- Loan portability: If you’re moving from one home to another then this feature will allow you to take your loan with you whenever you move without needing to arrange a new loan.
We have nearly 40 lenders to choose from including major banks and specialist lenders.
We can help you refinance to a much cheaper rate, unlock your equity and help you achieve your financial goals.
Speak with one of our experienced mortgage broker about the benefits of refinancing. Call 1300 889 743 or fill in our free enquiry form today.