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17 Answers

We think we could get a better deal on our home loan, especially with interest rates being so low at the moment…to those Mums who have refinanced, how did you know it was the right thing to do?


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  • Do some research and find out what deals you can get and the costs involved. If another bank offers you a better deal take that to your current provider and see if they will match it. Often they do.


  • Perhaps check out a comparison website.


  • It never hurts to ask around – meet with several providers, ask them what they can do for you. Look over all the terms and then compare it with what you are paying. You may just find you will get a better deal.


  • It’s a good idea but ask your current lender if they can give you a better deal first


  • I refinanced my home loan approximately 12 months ago and don’t regret the decision at all; it was definitely right for me. I decided to look into refinancing due to the reduced interest rates compared to when my mortgage was initially financed. It was the first time I’d been through the refinancing process but once I’d weighed up my options and decided which financial institute I was going to proceed with it was a fairly straight forward process; more so than arranging the loan/mortgage in the first place.
    I definitely recommend doing your research into the loan options available to you through various institutes, including the interest rates on offer and weighing up the options that best work for you. Some of the things to consider include:

    1. Loan Type – i.e. fixed term versus variable, or a combination of both. I fixed a portion of my loan with the remaining amount variable.
    2. Exit Fees/Charges from you current loan contract – ensure you are aware of any costs associated with exiting your current mortgage arrangement so that you don’t get a nasty surprise.
    3. Loan Account Fees – some loans have monthly or annual fees, where as others don’t have any. Important to be aware of those associated with any prospective loan arrangement you enter into.
    4. Other benefits associated with the loan e.g. credit card, insurance, etc.
    5. Redraw facility – this was an important feature for me and I excluded from the outset any loan options with a redraw facility.

    In deciding if refinancing is right for you, you may need to consider your current employment situation, current value of your property, etc, as required for pre-approval of any loan.

    Whilst all this information requires appropriate consideration, if I were to give you one piece of advice from the outset it would be to advise you against going to individual financial institutes and for pre-approval in advance of determining who you will go with, but rather go through an independent body e.g. echoice. The advantage being that they can find the best loan option for you based on criteria that you provide and a number of institutes with which they have an established relationship. Essentially they can do the legwork in establishing which institutes can offer you the best loan to meet your requirements. Furthermore, a somewhat little known fact it might seem, every time you lodge a request for pre-approval (even if you are approved and don’t proceed, and even if with different financial institutes) it can work as a negative strike against your credit rating. Going through an organisation which can’t do the comparisons for you removes this risk against your credit rating.

    Hope this info helps and isn’t too confusing! Sorry bit late at night :)

    Good luck with your refinancing decisions!!

    P.S. My parents have recently refinanced their entire property portfolio based on my advice and they’re saving around $400 a month on their repayments, whilst still paying off over the same term!


  • why not? if it is going to save you precious money or you can pay off the loan a bit quicker, it is worth it. make the banks work for your money!


  • Hi, Hubby and I just refinanced our loans . Make sure you work on comparison rate to get the true interest rate and get an offset account with your loan, Many offer free offset account, pays your loan off quicker, visit bank websites and read FACS for your research.
    Good luck
    Maree


  • Personally, I would never do it again. A costly exercise, where our original bank was quite prepared to meet the same lower rate we were moving for. Talk turkey with your current bank and avoid the nightmare (perhaps intended, to minimise this type of thing occurring).


  • I work for a Mortgage Choice franchise & there are definitely a lot of competitive rates around, i’d suggest speaking to your current lender to see if you can get a better deal, if they can’t then ask them what costs are involved to pay out your loan. If you opt to refinance to another lender these fees need to be taken into consideration compared to the new rate you could achieve by going elsewhere. Another option is splitting your mortgage & having 3/4 of it fixed and concentrate on hitting the other 1/4 variable portion, that way if you want to get an increase (depending on available equity) you should be able to increase on the variable portion & leave the fixed rate as is.
    As for rates you definitely need to look for something under 5%, there are some variable rates as low as 4.69% (depending on the loan to value ratio)
    Good Luck with your search!


  • Now is a great time to refinance through a mortgage broker – rates are very low and you can probably get a better deal. It’s also a good time to look at fixing the rate on a portion of the loan so that you can keep that low rate for longer. You can also look at the option of an offset account so that you can make additional repayments while rates are low but you can still have access to this money.


  • I don’t think loans these days unless absolutely necessary are a good idea


  • A broker is the best person to speak to about refinancing. They will try and source the best deal for you. However before you do this you should just go and speak to your bank as they might be able to match or better the other deals. If you have been a good customer and have been with them a while the should do something for you.


  • talk to your bank and tell them your not happy and your thinking of going elsewhere because of the other banks cheaper rates, if they don’t want to lose you as a customer then I am sure they will drop their rate. We did this saved us money in more ways than one.


  • Personally we have done it a few times. If you are going to take up a fixed rate home loan it is a great sense of knowing what your repayment amount is for budgeting finances. However, each time my husband was tempted to also top up the home loan amount to buy car or pay off credit card and I absolutely regret doing that. It was necessary at the time but now he has done it a few times our loan repayments are so much closer to the home value that it is uncomfortable.


  • See a good mortgage broker to work out your options and find the best deal.


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