We’ve put together the lowest rates we can so you can pay off your loan sooner.
We’ll give you up to 8 offset accounts or free redraw depending on your loan.
We’ve said goodbye to application and ongoing fees to keep your costs down.
We’ll give you the ability to make extra repayments and change your repayment frequency.
1. Decide what’s right for you
Kudos to you for keeping tabs on your home loan! Regular check-ins are key to smart financial management. And if you’re considering refinancing, it’s a step in the right direction.
But before diving in, it’s important to ask yourself what you hope to achieve through refinancing. This will help guide your next steps and ensure you’re making the best decision for your finances.
Here are a few things to think about:
What’s your rate? Chances are your interest rate has risen over time. If it’s not in line with other rates on the market, it might be time to make a change.
What features do you need? Depending on your existing loan, you may find more flexibility by refinancing to a lender who’ll give you offset accounts, redraw facilities or repayment options.
What other debt do you have? If you’ve got other debts around the place, refinancing could be a way to consolidate everything into one place so you only have to keep track of a single repayment.
Do you want to access equity? If you’ve been thinking of renovating or maybe buying a new place, refinancing could give you access to some extra cash through equity in your current home.
2. Understand your financial situation
Once you’ve decided that refinancing is a good move, it’s time to get a better feel for your own financial situation.
First up you’ll need to figure out what your loan-to-value ratio or LVR would be for a new loan. To do that, take your current loan amount, divide that by the current value of your property, and then multiply it by 100. If the number you get is 80% or lower, you’ll be in good stead when it comes to refinancing. You may even be able to unlock some extra finance in the process.
This is also a good time to check in on your credit score, as that will also have an impact on your refinancing options.
Now that you’ve got a better idea of your situation, it’s time to think about what you could gain by refinancing.
While most people are looking for a better rate, don’t forget that there are other features that could give you a boost in the long term. Do some research about the current market rate, as well as the features on offer from other loans.
Here are some things to think about when deciding on what you’d like out of your loan:
Fixing your rate for 1-5 years will give you confidence about your repayment amounts, though variable rate loans tend to be more flexible when it comes to features.
And then there’s the option of splitting your loan, which could give you the best of both worlds
When you refinance, you may have the option to choose a longer term.
Doing so could mean your monthly repayments are lower. But it could also mean you end up paying more interest, so be sure to weigh the pros and cons before you decide.
Cashback or rebate
Lenders often offer cash rewards or rebates (which lower your loan balance) to tempt you to refinance.
These offers can definitely give you a boost, but don’t forget to take into account the interest rate, fees and features before you decide.
The ability to make weekly or fortnightly repayments can help you save on interest – as can making extra repayments.
Look for a refinancing option that gives you the flexibility to change repayment frequency or make extra repayments without charge.
Offset or redraw
Storing your money in a linked offset account can help you save on interest, though many fixed rate loans won’t allow offset accounts.
Meanwhile, redraw facilities allow you to access any extra repayments you’ve made if you need the cash later on.
Fees & charges
Don’t forget that home loans often come with service fees – along with discharge fees and break costs if you’re on a fixed rate.
Make sure to do your homework and check you’ll still be ahead once all these charges are taken into account.
4. Figure out the costs involved
As you consider refinancing, don’t forget to factor in the costs as well as the potential rewards.
While a new loan may offer a better rate and more features, there are always expenses involved in breaking with your current loan and setting up a new one.
Before making the switch, take a closer look at the fees you’ll be charged – by both your current lender and your new one. That way you can make an informed decision about whether refinancing is right for you.
Exit fees From your current bank
These fees cover the cost of closing your home loan and releasing any security you’ve provided as collateral.
These fees pay for any processing, paperwork and administration involved in paying out your old loan.
If you’ve got a fixed-rate home loan, you may be charged additional fees for exiting (or breaking) your loan early.
Upfront fees From your new bank, once off
Lenders Mortgage Insurance (LMI)
Some lenders will charge you a fee to cover the costs of establishing your loan. To make things simple, we’ve said goodbye to establishment fees across both our myBlue and liteBlue loans.
Just like when you got your first home loan, you’ll need to pay a small fee to register your new mortgage. That said, the amount you need to pay will differ depending on the state or territory you’re in.
If you’re refinancing with less than 20% equity in your property, you may be required to pay LMI. This is a one-off insurance payment to protect your new lender in the event that you are unable to repay your loan.
5. Compare home loan options
You’ve decided that refinancing is the right call. You’ve had a good think about what you want out of your new loan. Now is the time to go out and get it!
The first thing to do is call your current lender and see if they’re able to offer a better rate or loan arrangement. If they can, it’ll save you the hassle – and cost – of moving.
If their deal doesn’t fit, check out other options available. Make a list of what you need and do some digging to find loans that align with your goals. If it seems overwhelming, you can always bring in a broker to help with the search.
Be sure to put our home loans in the mix as you look – they’ve got the best rates we can muster, plus the simplicity and flexibility you’ve been waiting for.
Once you’ve found a home loan that ticks all your boxes, all that’s left to do is apply. The process will be much like it was when you applied for your current loan, and with any luck you’ll have a new loan sorted in a matter of days!
Whether you’re going directly to a lender or through a broker, here’s some of the information you’re likely to need:
Personal details Think name, age, address, family situation. You’ll also need to supply proof of your identity.
Property & loan details Details about your property, including type and location, as well as information about your current loan.
Employment details Information on your current and past employers, as well as evidence of your current income and earnings.
Expenses, assets & liabilities Details and evidence of your current exp[enses, as well as any assets (cars, investments) and liabilities (credit cards, personal loans).
If you’re applying to refinance with us, there are a number of ways you can get the ball rolling:
So you got the green light from your new lender, congratulations! They’ll be sending over a new contract and mortgage paperwork. But before you sign, make sure you’ve had a professional look things over. And don’t be afraid to ask questions to make sure you fully understand the terms and conditions of your new loan.
Once everything is signed and sealed, your new lender will take care of transferring the mortgage and any other accounts from your old lender. Just keep in mind, any delays from the old lender can impact your loan settlement date.
^ Interest rate is only available to owner-occupied loans on liteBlue and myBlue principal and interest repayments with less than or equal to 60% Loan to Value Ratio (LVR). Interest rates for investment loan purposes, interest only loans and other applicable LVR tiers will differ.
^^ Comparison rate based on a secured loan of $150,000 over 25 years. WARNING: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees and other loan amounts might result in a different comparison rate. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan.