Refinance your home loan

Refinancing means replacing your existing home loan with a new one — either with a different lender or by rewriting the loan with your current lender. The new loan pays out the old one, and you keep the property. Australians usually refinance to reduce the interest rate, consolidate higher-rate debts, release equity, or restructure the loan so it is paid off sooner.

In practice it is six steps: work out what your current loan is really costing you, check your equity and servicing position, compare what is available to you across lenders, apply to the one your position actually fits, let the new lender value the property and issue formal approval, then settle — the new loan discharges the old one and repayments start with the new lender. Most refinances take four to six weeks end to end, and the paperwork you provide is usually payslips or tax returns, ID, a rates notice and your current loan statements.

It depends entirely on the gap between your current rate and what is available to you, and on how the new loan is structured. As a guide, a 0.5% reduction on a $600,000 loan is roughly $250 a month in interest, and around $3,000 a year. Where a review saves considerably more is when the term is held rather than reset, and when higher-rate debts are brought into the same strategy. We put both figures in front of you before you decide anything.

There is no minimum waiting period in Australia — you can refinance at any time, including within the first year, as long as a lender will approve the new loan. The practical limits are equity (most lenders want the new loan at or under 80% of the property's value for the sharpest pricing), your ability to service the loan today, and a clean recent repayment history. If you are on a fixed rate, a break cost may apply until the fixed period ends.

It is usually worth it when your rate is 0.3% or more above what you could get, when you have higher-rate debts that could be brought into the mortgage, when your equity has improved enough to reach a better pricing tier, or when the loan structure no longer suits you. It is usually not worth it when the gap is small and your lender will match it, when a fixed-rate break cost swallows the saving, or when your income or credit situation has just changed and approval is unlikely right now. Ask your current lender to reprice first — that is free.

Yes, in two ways. A reprice simply lowers your rate on the existing loan and usually costs nothing — always ask for that first. An internal refinance rewrites the loan, so you can change the term, split it, add an offset or consolidate other debts without moving lenders. A reprice only changes the price; if the structure is the problem, the loan needs to be rewritten, and at that point it is worth comparing other lenders too.

It will if you let it. A refinance can be written as a new 30-year loan, which lowers the repayment and raises the total interest. We set the term to match what you have left, or shorter, and keep your repayment where it is so the rate saving goes to the principal rather than to a longer loan.

Expect a discharge fee from your outgoing lender (commonly $150–$400), government fees to discharge and register the mortgage (roughly $150–$400 depending on the state), and sometimes an application, valuation or settlement fee at the new lender ($0–$800). Together that is commonly a few hundred to around a thousand dollars, and many lenders waive or rebate parts of it. If your loan is partly fixed, a break cost may also apply. We get every figure in writing and only recommend the switch when the saving clearly outweighs it.

Ranges are indicative only and vary by lender, loan type and state. Divide your total switching costs by your monthly saving to get your break-even point — under a year is common on a meaningful rate difference.

The first conversation takes about 15 to 20 minutes. From application, most lenders take roughly two to four weeks to reach formal approval, depending on how quickly a valuation can be completed and how straightforward the income evidence is. Discharging the old loan usually adds a couple of weeks on top, and we manage that end of it for you.

There is no legal limit, but refinancing every year rarely makes sense — each switch carries costs and a credit enquiry. The better rhythm is to review annually and only move when the numbers justify it. In most years the answer is either no change, or a repricing request to your existing lender, which is free and often effective.

You can, but you may face a break cost, which is the lender's estimate of what it loses by releasing you early. It can be trivial or it can be thousands, depending on how rates have moved since you fixed and how long you have left. We ask your lender for the figure in writing and weigh it against the saving before recommending anything. Where the break cost does not stack up, we plan the refinance for the end of the fixed period instead.

Usually yes, provided there is enough equity and the loan still fits within lender limits. The repayment relief is immediate because the debts move from rates near 12% to 20% down to a mortgage rate. The trap is stretching a five-year debt across 30 years. We only recommend it as part of a plan that redirects the freed-up cash flow back at the mortgage and closes the accounts behind you.

As a rule of thumb, lenders like to see the loan at 80% of the property's value or less, which avoids lender's mortgage insurance and opens up the sharpest pricing. Refinancing above 80% is possible but the options narrow and the cost rises. If you are not sure where you sit, an indicative valuation will tell us quickly.

Almost always, because the new lender needs to know the loan-to-value ratio it is lending against. It is often an automated or desktop valuation rather than a physical inspection, and the lender usually pays for it. Where a property has clearly grown in value, ordering the valuation early is the single fastest way to find out whether you have reached a better pricing tier.

Often yes, but lender policy varies enormously. Some want two years of tax returns, others will work from one year plus business activity statements, and a few will accept an accountant's declaration. If you have recently changed jobs, gone to one income, or started a business, the answer depends on which lender the application goes to — which is exactly the sort of thing worth checking before anyone touches your credit file.

A refinance application creates a credit enquiry, which has a small, short-lived effect. Multiple applications across several lenders in a short window do more damage, which is one reason to work through a broker: we assess your position against lender policy first and apply once, to the lender most likely to approve you.

Repricing with your existing lender usually costs nothing, and it is always worth asking before you move. The catch is that a reprice only changes the rate — it does not fix the term, the structure or the way your other debts are set up. Where a lender will match sharper pricing and the structure is already right, staying put is often the sensible answer.

No. We review your loan every year, and in most years the answer is either no change at all or a repricing request to your existing lender — which is free and often effective. Changing lenders is worth doing when the gap is large enough to clearly beat the switching costs, and we will tell you when that is the case rather than moving you for the sake of it.

It can help or hurt depending on how it is structured. Consolidating high-repayment consumer debts into the mortgage generally improves your assessed servicing, while stretching a loan back out to 30 years or adding a large cash-out can reduce future capacity. If a purchase is on the horizon, tell us early so the refinance is structured with that next step in mind.

Once a year. Lender pricing drifts, discounts you negotiated get quietly overtaken by what new customers are offered, and your equity position changes as the balance falls and the property value moves. An annual review takes minutes and is the difference between a loan that stays competitive and one that slowly costs you more each year.