Refinancing Your Home Loan

The last two years have been tumultuous in so many ways. While the COVID-19 pandemic has wreaked havoc on “normal,” the property market in Australia has seen prices skyrocket, followed by the seven interests rate hikes in a row. With the latest interest rate hike on December 7th, 2022, the Reserve Bank of Australia (RBA) cash rate now remains at 3.10%. With the current scenario home loans should never be a ‘set and forget’ part of your life.

When and why should you refinance?

If you’ve only recently taken out your home loan from Credit Hub Australia, you can be confident that our experienced broker has recommended you the loan best suited to your needs – and you’ve got a pretty good deal.

Otherwise, there are many underlying reasons to review your current loan portfolio and to keep your self updated. It is a smart practice to review your loan on a timely manner. If the property is investment or owner occupied, then it makes even more sense to review the existing loan portfolio.

If you have had the same loan for several years or longer it is recommended to see how it stacks up against the changing mortgage market. There is a huge chance that you could save with a lower rate.

Refinancing isn’t just about scoring savings, but it can also help you in achieving important personal goals.

Benefit of refinancing includes:

·         Securing a lower interest rate.

·         Finding features that help you pay down the loan faster.

·         Consolidating debt

·         Accessing home equity.

How does refinancing work?

If you are looking at refinancing your home loan, your lender will require an up-to-date valuation of your house. The process is similar to when you bought the property. In refinancing, you are essentially taking a new home loan to pay off your existing one. The new home loan can either be with your existing lender or with a new lender.

Lender will usually go through your refinance application to get up to date insights on your financial situation, as your situation is likely to have changed. The same will be done for your property to evaluate the current value of your property and whether your loan-to-value ratio (LVR) is still at an acceptable level to refinance. The valuation is usually organised by the lender, and it might involve physical inspection of the property.

How long is the process of refinancing?

A refinance typically takes 4-6 weeks to complete. However, no one will be able to tell you exactly how long yours will take.The process of switching to a new home loan may sound like a hassle, but it can be fairly easy.

The process of refinancing includes:

·         Once you’ve chosen your preferred option, the application process works and if you choose to go with a broker, they will then prepare all the paperwork, and submit it to the lender once signed.

·         Once the new loan get approves, your current lender will be notified that you’d like to pay out your existing loan.

·         You’ll be given a final pay out figure when your current lender knows the exact date of settlement.

·         Your new lender will pay out your old loan and you will receive new documentation for your new loan, and you will begin making repayments on your new loan.

Why choose a mortgage broker for refinancing?

A broker generally has access to over 50+ lenders including bank and non-bank small lenders. Going to a mortgage broker is a smart choice as a broker is like a one-stop-shop, and they will do all the leg work and you will have the valuation reports of your house from different lenders. You will be able to review which lender is offering you the best valuation of your property and choose your lender accordingly.

As a mortgage broker, Credit Hub Australia team go into bat for clients every day to ensure they’re not paying too much for finance that isn’t as competitive as it could be. And the team look at each client’s individual circumstances to make sure they have the right commercial finance in place.

With access to hundreds of different loan products from Australia’s leading lenders, our team can negotiate great rates on deals that suit you, not one that necessarily suits your bank manager. And remember, we do all the hard work for you, managing the process from start to finish – at no cost to you for our service.

If you’re wondering if you can get a better rate in the market for your existing loan, then wait no further and let’s talk.

The market has changed and I’m sure your circumstances have changed too. A quick glance at your file, and our expert team can tell if it is time to review your loan and ensure that you’re still in the right mortgage solution. Call our friendly team at 1300782944 or leave us your contact details.