Should I refinance my home loan?

Dec 10, 2021 Uncategorized

Refinancing simply means securing a new home loan that repays and replaces your existing one.

You may consider refinancing your mortgage to lock in a lower interest rate or take advantage of better loan terms or features such as a redraw facility or flexible rates. You may want to access home equity to invest in properties, shares, or a managed fund. Or you may be looking to consolidate debt into a single payment.

Refinancing can be a good option for many homeowners, But remember, it’s not right for everyone. Here are some reasons you may be keen to refinance and what to consider.


This is the most common reason one chooses to refinance a home loan. And if you’ve had your mortgage for several years, your current lender has probably introduced more competitive products since. You may have found a better deal with another lender.

But while saving money can be an excellent reason to refinance, it’s crucial that you consider more than the interest rate before switching loans. You should also dig down the fees you’ll need to pay for exiting your existing mortgage and signing up for a new one.

A professional mortgage broker like Lending Partners can help you understand the pros and cons of refinancing your loan. They review your current loan structure, income, assets, and financial goals and map them internally. Then they look at other loans from their associated lenders that might offer you a more competitive rate. Once a broker has found suitable products, they’ll also look at the exit and application fees to calculate your total cost saving. Sometimes, you’ll only save a couple of hundred dollars a year, and refinancing might not be worth your while. Other times, your broker may be able to save you around $1,500 a year.

Remember, Sometimes, a mortgage broker can also negotiate a better interest rate with your current lender, without you needing to refinance.


Refinancing your loan with a new lender may mean you need to pay Lender’s Mortgage Insurance (LMI). In this case, refinancing might not be a good move for you. But working with a mortgage broker has its advantages over going straight to an institutional lending bank. A broker will generally have access to a panel of around 20 lenders and can likely negotiate a better deal for you.

A mortgage broker can also help you understand any hidden loan costs and the different loan features that might save you money or help you achieve other financial goals.


Refinancing can be a good option if your credit cards or personal loan interest rates are much higher than your home loan rate. Debt consolidation may lower your monthly repayments, save you interest in the long-term and reduce your financial admin burden.

If you do decide to go down this route, be mindful of not extending the life of your personal loan or credit card to the term of your mortgage.

If you want to refinance to consolidate debt, Team Lening Partner can guide you through every step of this process, providing expert advice and answering all your questions along the way.

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