Refinancing your home loan can be a smart way to take control of your finances and ensure your loan continues to work in your favour. Here are some of the key benefits:
1. Lower your interest rate
Even a small reduction in your interest rate can lead to significant savings over the life of your loan. Refinancing gives you the opportunity to take advantage of better rates on the market.
2. Reduce your repayments
A lower rate or a longer loan term can help reduce your monthly repayments, easing the pressure on your budget and giving you more breathing room.
3. Pay off your loan faster
By keeping your repayments the same after refinancing to a lower rate, you can shave years off your loan term and save thousands in interest.
4. Consolidate debt
If you have multiple debts, such as credit cards or personal loans, refinancing can allow you to roll everything into one loan with a single, lower repayment.
5. Access equity in your home
Refinancing can give you access to the equity you’ve built in your property, which can be used for renovations, investing, or other major expenses.
6. Improve your loan features
Your current loan might not offer features like an offset account or redraw facility. Refinancing can give you access to more flexible options that better suit your needs.
At Irwin Financial Solutions, we’ll help you assess your options and guide you through the refinancing process from start to finish. Let’s explore whether switching makes sense for your situation.
The cost of refinancing a home loan can vary depending on factors like the lender, outstanding loan amount and your financial situation.
Typical costs include:
Application and establishment fees
Discharge fees
Property valuation fees
Lenders Mortgage Insurance (LMI) if you have less than 20% equity in your property
Break costs if you have a fixed rate home loan and choose to refinance before the end of your fixed term
Before starting the refinance process, speak to an one of our brokers to weigh the pros and cons and see if refinancing could save you.
A cash out refinance allows you to borrow against the equity in your home to receive a lump sum of cash.
You can do this by replacing your existing home loan with a new one that has a higher balance. The difference between the two loans is given to you in cash.
This cash can be used for various purposes, such as home improvements, debt consolidation or other financial needs.
Want to know more or see how much equity you have in your home loan? Talk to one of our brokers today.
