What is Refinancing??

Refinancing is simply the means of switching your mortgage from one home loan lender to another. We all have different motivations for switching and there needs to be a clear benefit. There is no need to do it just because it’s been a while, or because some ones else said to do it. But it is important to keep on top of your home loan with regular reviews.

We’ve highlighted below some of the top reason to switch, as well as some of the reasons you may not want to switch.

Reasons to Refinance:

  • Obtain a lower interest rate – rates changes all the time, what you set up initially might not be so competitive anymore.
  • Change if your requirements, such flexible repayments, redraw facilities and account splitting
  • Your circumstances have changed – perhaps when you took out the loan you had unusual employment circumstances, or a low deposit?
  • Need to release some equity for renovations, future investments or personal use.
  • Switching to or from a fixed rate
  • Consolidating your debts – why pay of multiple lenders at various, likely higher rates, when you can pay the all of in one easy to manage repayment at home loan rates

Has it been 12 months or more since you list reviewed your circumstances? Much as changed! Contact us today for your complimentary review

Reasons not to Refinance:

  • You have plans to sell or off-load the property very soon
  • Switching costs outweigh the benefits of moving
  • You credit history as been severely damaged – that being said, you should defiantly chat with a mortgage broker as sometimes your equity can help to clear up some of that burden
  • You’ve ceases working or your income had been depleted
  • You don’t have sufficient equity
  • You have a really low balance – perhaps an accelerated payment plan is worth considering.

When considering if you should switch your home loan you should always consider your goals and if it will help you achieve them faster. Consider if the benefits outweigh the negatives and consult a professional to get the right advice.

Refinancing isn’t always our solution, sometimes there are other strategies we can put in place to help you achieve you goals. Feel free to get in touch and we’ll be happy to help.

 “Banks are limited to only offer you their range or products, and that might not always be what is right for you – or the most cost effective offer. Our FREE lender comparison report keeps the banks honest and your mortgage affordable. Get your report here!