The combination of low interest rates and the COVID-19 property boom means it is very likely interest rates will go up. Whilst variable rates remain low, four-year fixed rates have already risen above two per cent from lenders across Australia.
The current borrowers’ market is primed for homeowners to re-finance their loan and get a better deal. Whilst the process can be daunting, re-financing in the current climate can save homeowners thousands. Canstar estimated that Australian homeowners can collectively save up to $15 billion in mortgage repayments if everyone re-financed.
How to re-finance
Ask your lender
If you already have a loan, you can start by asking your current lender for a better deal. If you tell your current lender that you are planning to switch away from them to get a better rate, they may offer to reduce your rate or match a competitor’s rate to keep your business. If they are not prepared to offer you a competitive rate, you may wish to consider changing lenders.
Making the change
Start by researching different loans available. To find the best loan for your needs you should look at the interest rate, as well as fees, charges and included features. It’s also important to consider any fees and costs associated with changing loans. The common ones are discharge fee, application fee and switching fee.
A mortgage broker can take the pain out of changing loans. They help find the best loan available for your needs and can guide you through the change over process.
While the process of re-financing can be time consuming, the savings are worth the effort.
Need help with your home loan?
TAG Finance & Loans can help.
Compare your current home loan at Compare N Save
Contact us for some expert advice.
Disclaimer: The information contained on this page is general in nature. Professional advice should be sought before acting on any aspect on this page. TAG Finance and Loans Pty Ltd ABN 25 609 906 863 Credit Representative Number 483873 National Mortgage Brokers Pty Ltd ABN 88 093 874 376 Australian Credit License 391209.