The home loan experts who give a buck

Refinancing your home loan means switching your loan to a different product or lender, or increasing your loan size. For example, you might switch from a variable to a fixed rate loan with your current lender, or stay with the same lender and increase your loan balance. Alternatively you could do the same but with a different provider.

If you’re increasing your loan amount, the lender will generally carry out a credit assessment, even if you’re staying with your current provider. They do this to ensure you can afford the repayments based on the higher loan balance. The lender will usually also arrange for your property to be valued.

If you’re switching lenders to get a better deal, the new lender will treat your application much like they would if you were buying a property for the first time. That means they will assess your financial situation, borrowing capacity and get your property valued.

Once you’re approved, refinance home loans work just like any other kind of mortgage product.

There are several potential costs to factor in if you refinance your home loan. You’ll have most of the same costs as you did when you got your loan initially (e.g. establishment fee and valuation fee), as well as a discharge fee charged by your old lender. Overall, expect to pay between $500 - $2,000.

If you’re staying with the same bank the cost of refinancing is generally lower and may even be nothing if it's a straightforward product switch.

Some lenders have home loan cashback offers for new customers, which could help offset the cost of switching if you're eligible.

Refinancing with a mortgage broker may save you some time, as the broker does a lot of the work for you. It can also be less of a hassle to have an expert do the research for you and simply present you with deals that are better than your current one. Your broker can also negotiate on rates and fees with your existing lender and any new ones you’re considering to make sure you’re getting the best deal possible.

If you decide to go ahead with the switch, your broker will also help with your application and any other paperwork required.

This depends on the type of refinance. If you’re simply switching to a new product with your current lender without increasing your loan amount, this process can be completed in days. If you’re applying with a new lender or borrowing more with your current one, that process could take between 2-6 weeks depending on how complex your application is.