Refinancing means taking out a new loan to pay off your existing home loan, and you can do this with your current bank or switch to a new one. It’s a great idea to review your current loan, especially now, as many banks offer cashback and waive application fees when you refinance—plus, you could score a lower interest rate!

“Thinking about refinancing your home loan? Here’s why it might be a smart move: lower interest rates, cashback offers, and no application fees. Time to save more!”

Here’s why refinancing your home loan could be a game-changer:

• Score a lower interest rate and reduce your monthly payments.
• Unlock your home’s equity for investments, renovations, or building projects.
• Consolidate high-interest debts like credit cards and personal loans into your mortgage.
• Get back on track if your loan is in arrears.
• Move from a specialist lender to a major one after overcoming bad credit.
• Maximize tax benefits.
• Choose a loan that helps you pay off your mortgage faster.
• Refinance to fuel your business growth.

“Ready to Refinance? Here’s What the Process Looks Like!”

1. Define Your Goal
   • Decide why you want to refinance: better rate, lower payments, or access equity.
2. Understand the Costs
   • Consider all fees (discharge, application, and valuation fees) and weigh them against potential savings.
3. Assess Your Equity
   • Calculate your equity (property value minus mortgage balance). Aim for at least 20% to avoid extra fees.
4. Prepare Your Documents
   • Gather home loan statements, income proofs, and ID.
5. Consult a Broker
   • Work with a broker to explore options, compare lenders, and understand cashback offers.
6. Get Conditional Approval
   • Submit paperwork to your chosen lender for conditional approval.
7. Prepare for Appraisal
   • Review your lender’s “Closing Disclosure” carefully, ensuring you understand all terms.
8. Obtain Final Approval
   • Confirm your equity and approval details.
9. Complete Settlement
   • Your broker handles the discharge process if switching lenders.
10. Set Up Your New Loan

• Receive your new loan details, confirm repayment setup, and activate any additional features.

Wondering how much equity you need to refinance? Here’s what you should know:

• 20% Equity: Most homeowners have enough equity to refinance, as lenders typically let you borrow up to 80% of your property’s value.
• Up to 95%: If you have a great credit score or are willing to pay Lenders Mortgage Insurance (LMI), some lenders may allow you to borrow more.
• Less Than 20%: You might still refinance, but you’ll likely need to pay LMI again.

Are You Eligible to Refinance?

• You owe less than 80% of your property’s value (avoid paying LMI).
• You have a variable-rate loan, which offers flexibility when refinancing.
• You can refinance a bad credit loan to a major lender if your Loan-To-Value Ratio (LVR) is 80% or less and your credit file is clean.
• You’ve upgraded from a low-doc to a full-doc mortgage and have solid income evidence.