How To Refinance Your Home Loan?

Refinancing a home loan means replacing your existing mortgage with a new one, either with your current lender or by switching to another. Done right, it can cut your repayments, unlock equity for renovations or investments, or help you consolidate debts.

How Does the Home Loan Refinance Process Work?

The refinancing journey is broken down into five distinct phases, which expert brokers can help navigate to save time and stress:

Plan Your Refinance

Determine goals (lower rates, debt consolidation, or unlocking equity) and calculate current break costs. At the same time, calculate your home equity since this will affect the deals available.

Compare Options

Weigh savings against discharge fees and compare offers from 50+ lenders, not just one bank.

Prepare Application

Gather payslips, loan statements, and ID; brokers package this to match lender policies.

Valuation and Approval

The lender conducts a property valuation (either a desktop inspection or full) and issues a formal loan contract.

Settlement

The new lender pays out the old loan, discharges the mortgage, and sets up your new repayment schedule.

Can I Refinance Without A Serviceability Assessment?

Yes, specific lenders offer dollar-for-dollar refinancing where no serviceability assessment is required, provided you have a clear payment history for the last 12 months. This means your new loan matches your existing amount but with better terms.

To be eligible for this streamlined refinancing option, you must meet specific criteria:

• The new interest rate must be lower than your existing loan.
• The Loan-to-Value Ratio (LVR) must be below 80%.
• The new loan must remain in the same name(s) as the original.
• There must be no change in the borrower’s primary income source.

When Is The Right Time To Refinance?

A general rule of thumb is to review your loan every 3-4 years, but specific life goals often dictate the best timing:

• Renovating? Refinance to release equity for upgrades or a granny flat.
• Managing Debt? Consolidate credit cards and personal loans into a mortgage repayment.
• Investing? Leverage available equity to purchase an investment property.
• Chasing Savings? Switch to take advantage of sharper rates or refinance cashback offers.

Over the next few days, you’ll receive additional guides to help you on your refinancing journey. Occasionally, you’ll receive carefully curated home-buying tips, cashback offers and news articles. You can unsubscribe any time you want. View our Privacy Policy

What Mistakes Should I Avoid When Refinancing?

To protect your credit score and ensure loan approval, avoid these common errors during the process:

• Avoid applying for credit cards or car loans before your refinance is approved.
• Late payments on your current loan impact your credit score and eligibility.
• Look beyond the headline rate to the comparison rate and associated fees.

Get Expert Help During The Refinance Process

Refinancing can feel overwhelming, but you don’t need to do it alone. At Home Loan Experts, our mortgage experts will:

• Compare 50+ lenders to find you a better deal
• Check if you qualify for cashback offers
• Handle the paperwork and legwork
• Provide free comparable sales report so you know how much equity you have to refinance
• Work in your best interests so the refinancing benefits you in the long run.