Find Lower Rates and Better Mortgage Deals

Looking to refinance a home loan? You are not alone. Around 16,000 Australians refinanced their home loans in 2019 according to the Australian Bureau of Statistics.

What is Refinancing?

Refinancing refers to replacing or extending an existing loan (in this case a mortgage loan) with funds either from the same lender or from a different one.

Case Study
Matt and Sally have $250,000 remaining on their home loan at 4.5% for 30 years.Their monthly repayment (principal + interest) is $1,267. The couple decided to refinance their mortgage and was able to find another lender that offers only a 3%loan resulting in their monthly repayment to drop to $1,055 per month. So, Matt and Sally were able to save $212 per month thanks to refinancing.
NOTE: Some reduction may be caused by stretching out the repayments instead of a lower interest rate. The longer you stay in your home, the more money you may save through refinancing. But you should remember that you may need to pay upfront closing costs when you are taking out a new mortgage from another lender.

How Does Refinancing Work?

The process for refinancing a mortgage depends on the type of your home loan and your lender. But in general, it looks like this:

  1. You have a current mortgage and you are interested to find better deals (lower interest rate, longer repayment terms, waived fees, etc)
  2. You look around for lenders (or ask a mortgage broker to assist you) and find one that offers better terms than your current mortgage
  3. You apply for the new home loan
  4. Once approved, the new lender will pay off your current debt
  5. Make the repayments on the new loan until you pay it off completely (or refinance again in future)

IMPORTANT: Be sure to check if your present lender charges a prepayment fee when you pay off your current loan too early. If yes, you need to compare the costs of the early repayment charges against the possible savings you can receive from mortgage refinancing.

Why Refinance Your Current Home Loan?

Many homeowners choose to refinance their mortgage in order to:

  • Lower monthly payments
  • Consolidate other debts
  • Change loan type
  • Secure lower home loan fees
  • Pay off loans faster
  • Ease their cash flow

Benefits to Refinancing with a Mortgage Broker

Mortgage refinancing is a crucial financial decision that you should not take lightly. That is why it is recommended that you do this with a licensed Sydney mortgage broker. Working with a professional can help you:

  • Assess your current situation
  • Provide you the most suitable refinancing strategy
  • Find a better deal, faster
  • Get exposed to new & emerging lenders with hot refinancing offers
  • Save a lot of time & effort - our brokers do all the legwork for you

The Mortgage Brokers at Shop Your Own Mortgage are experienced in debt restructuring to refinance almost any home loan. Try us out!