Refinancing your home loan can be rewarding if you’re looking for better customer service, specific loan features or benefits, or a cheaper interest rate.

However, even if you’re looking to simply consolidate debts or switch from a variable to a fixed rate, it’s important to understand that refinancing is not simply a process of ‘tweaking’ your existing home loan. You’re actually taking out a whole new loan contract.

Why advice can be valuable

Reasons for refinancing range from buying a new car or home renovations, through to getting a home loan comparison in order to secure a better deal and reduce loan costs.

If you’re thinking about refinancing your home loan, the advice of your Trusted Mortgage Broker can be invaluable to help you understand the costs involved – particularly in relation to your unique situation – and, then, tailoring the new loan to suit your needs beyond the immediate future.

The cost will also depend on the loan you take out and the loan you’re paying out with the new application.

For example, if your existing loan has a Professional Package, for which you pay an annual fee, generally speaking the loan amount can be adjusted without attracting an additional fee. However, if you have a basic loan, for which you don’t pay annual fees, usually there are fees to modify the loan – depending on what you want to do.

Also, many lenders offer special deals that aren’t advertised, so it’s always valuable to speak with your Trusted Mortgage Broker.

Plan beyond the here and now

If you take the time to consider your needs now and in the future, it’s possible to take out a home loan that’s going to work for you long term – reducing the need to consider refinancing your home loan in the coming years.

For example, it may well be that a basic ‘no frills’ loan is going to work very well for you for the next two to five years, but if you plan to have a family, take a holiday or renovate your home, you might find the long-term savings, convenience and savings benefits of a home loan with a Professional Package far outweigh the annual fee.

Trusted Mortgage Broker has a great range of mortgage calculators to help with all those tough decisions that come with finding the right loan. Have a look at our calculators on our website to help you further. www.trustedmortgagebroker.com.au/calculators/

About the Author

Sue Hayter

Sue's service commitment is fantastic. At Trusted Mortgage Broker we work with our clients to ensure they understand their options, know exactly how much they can borrow and ensure they choose the right home loan and the right lender that is not unsuitable to their individual needs.

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