Refinance your home loan

Calculate how much time an money you could save by refinancing your home loan. Compare mortgage options to see whether switching may better suit your lifestyle and budget.

Mortgage Balance

$

Monthly Repayment

$

Interest Rate

%

Savings Over

years
Remaining loan term

0 years

Showing home loans based on a loan of
$
with a deposit of
Company
Commonwealth Bank of Australia
Advertised Rate

2.69%

Variable

Comparison Rate*

2.70%

Repayment

$1,418

monthly

Savings Over Years

$55.6k

Savings over 10 years

Total estimated upfront fees
$200
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Company
Commonwealth Bank of Australia
Advertised Rate

2.14%

Fixed - 3 years

Comparison Rate*

3.83%

Repayment

$1,318

monthly

Savings Over Years

$67.6k

Savings over 10 years

Total estimated upfront fees
$200
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Company
loans.com.au
Advertised Rate

1.99%

Intro 12 months

Comparison Rate*

2.47%

Repayment

$1,379

monthly

Savings Over Years

$60.2k

Savings over 10 years

Total estimated upfront fees
$520
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Winner of Best refinance home loan, Best variable, RateCity Gold Awards 2021

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Company
loans.com.au
Advertised Rate

2.48%

Variable

Comparison Rate*

2.50%

Repayment

$1,379

monthly

Savings Over Years

$60.2k

Savings over 10 years

Total estimated upfront fees
$520
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More details
Company
Athena Home Loans
Advertised Rate

2.29%

Variable

Comparison Rate*

2.23%

Repayment

$1,345

monthly

Savings Over Years

$64.3k

Savings over 10 years

Total estimated upfront fees
$0
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More details
Company
Athena Home Loans
Advertised Rate

2.64%

Variable

Comparison Rate*

2.59%

Repayment

$1,409

monthly

Savings Over Years

$56.6k

Savings over 10 years

Total estimated upfront fees
$0
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More details
Company
Suncorp Bank
Advertised Rate

2.54%

Variable

Comparison Rate*

2.55%

Repayment

$1,390

monthly

Savings Over Years

$58.9k

Savings over 10 years

Total estimated upfront fees
$0
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More details
Company
Suncorp Bank
Advertised Rate

1.89%

Fixed - 2 years

Comparison Rate*

2.94%

Repayment

$1,275

monthly

Savings Over Years

$72.7k

Savings over 10 years

Total estimated upfront fees
$0
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Company
Bank of Queensland
Advertised Rate

1.99%

Fixed - 4 years

Comparison Rate*

2.90%

Repayment

$1,292

monthly

Savings Over Years

$70.7k

Savings over 10 years

Total estimated upfront fees
$800
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Company
UBank
Advertised Rate

1.75%

Fixed - 3 years

Comparison Rate*

2.22%

Repayment

$1,250

monthly

Savings Over Years

$75.7k

Savings over 10 years

Total estimated upfront fees
$0
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More details

Refinance process

Follow these steps to select a new home loan that better suits your needs:

Case studies

See the impact that refinancing and switching lenders made on the lifestyle and personal finances of these Australians:

"When we first moved to Australia, we joined ANZ, so naturally we got a mortgage with them too. But we weren’t happy with their rising rates so I did some research and swapped to Reduce. They were very kind and helpful, and now we’re saving almost $400 a month!"

Ana and Marian
Owner occupiers Truganina, VIC

"We had been on a Westpac mortgage for 10 years when they sent us letters saying they were raising rates. We spoke to ING and they quickly got the ball rolling. I’m self-employed and even for me it was a straightforward process. Now we’re saving over $2,500 a year."

Steve and Emily
Owner occupiers Roweville, VIC

"I’d been with CBA since I was a kid. One day I found a lower rate with Reduce Home Loans on a comparison site and made the switch. Reduce made it easy and straightforward, and now I’m saving almost $5,000 each year on my home and investment property."

Nick
Owner Occupier & Investor Southport, QLD

What is refinancing, and what does it mean to refinance your home loan?

Refinancing your home loan simply means switching from your existing loan to a new one that is offered by either your current lender or a different one altogether.

Why should I consider refinancing?

As the market is continuously changing, it may be a good idea to consider regularly shopping around for a better deal on your mortgage. While the most obvious reason to consider refinancing might be to reduce your interest rate, there are plenty of other potential advantages including:

  • Paying off your loan faster with a shorter term
  • Getting a more flexible loan
  • Accessing more competitive features
  • Switching from a variable to a fixed rate, or vice versa
  • Consolidating debts
  • Making the change to a lender that provides better customer service

Are there any disadvantages to refinancing?

It’s important to take into account any fees you may be charged for refinancing your home loan, and whether or not the savings you might make on a lower interest rate would outweigh the cost of making the switch.

Some of the potential penalties you may encounter include a break fee for those currently on a fixed rate loan, a switching fee for refinancing with the same lender, and an application fee when applying for a new loan.

Additionally, refinancing may cost you time and effort when going through a new lender’s application process.

Is refinancing a good idea?

Refinancing your home loan can allow you to benefit from lower interest rates or home loan features and benefits that better suit your financial situation. If your lifestyle and personal circumstances have changed since you first applied for your home loan, and you’ve found a mortgage deal that might be better suited to your needs, you may want to consider refinancing, either with your current lender or a new one.

There are also risks to consider when refinancing. For example, the cost of fees and charges when switching loans may reduce the overall value offered by lower interest rates. You’ll also want to make sure you’re in a financial position where you can comfortably afford to refinance. 

If you’re not sure whether it’s a good idea for you to refinance right now, consider contacting a mortgage broker for more personal financial advice. 

What is a refinance home loan?

Most home loans can be used to refinance, but a refinance home loan is a mortgage offer that’s been specifically designed for borrowers who are refinancing existing loans, rather than buying property for the first time. 

Home loans for refinancing may offer lower interest rates or more flexible home loan features, though they may also require the borrower to hold extra equity in the property to reduce their loan to value ratio (LVR). 

How do I refinance my home loan?

The first step is to identify what you want to achieve by refinancing, whether that is a reduced interest rate, shorter term or something else. Once you have that established, you can begin comparing your current loan to others on the market and create a shortlist of those that fit your goals. 

Be sure to weigh up the total switching costs you may incur with any potential savings before making a decision to apply for a new loan. Our home loan refinance calculator may come in handy here.

If you are happy with your current lender, you may also consider negotiating with them to switch to one of their more competitive loans in order to save the time and energy it takes to apply for a loan at a new bank.

How do I refinance my home loan?

Refinancing your home loan can involve a bit of paperwork but if you are moving on to a lower rate, it can save you thousands of dollars in the long-run. The first step is finding another loan on the market that you think will save you money over time or offer features that your current loan does not have. Once you have selected a couple of loans you are interested in, compare them with your current loan to see if you will save money in the long term on interest rates and fees. Remember to factor in any break fees and set up fees when assessing the cost of switching.

Once you have decided on a new loan it is simply a matter of contacting your existing and future lender to get the new loan set up. Beware that some lenders will revert your loan back to a 25 or 30 year term when you refinance which may mean initial lower repayments but may cost you more in the long run.

When should I switch home loans?

The answer to this question is dependent on your personal circumstances – there is no best time for refinancing that will apply to everyone.

If you want a lower interest rate but are happy with the other aspects of your loan it may be worth calling your lender to see if you can negotiate a better deal. If you have some equity up your sleeve – at least 20 per cent – and have done your homework to see what other lenders are offering new customers, pick up the phone to your bank and negotiate. If they aren’t prepared to offer you lower rate or fees, then you’ve already done the research, so consider switching.

Does Australia have no cost refinancing?

No Cost Refinancing is an option available in the US where the lender or broker covers your switching costs, such as appraisal fees and settlement costs. Unfortunately, no cost refinancing isn’t available in Australia.

Will I have to pay lenders' mortgage insurance twice if I refinance?

If your deposit was less than 20 per cent of your property’s value when you took out your original loan, you may have paid lenders’ mortgage insurance (LMI) to cover the lender against the risk that you may default on your repayments. 

If you refinance to a new home loan, but still don’t have enough deposit and/or equity to provide 20 per cent security, you’ll need to pay for the lender’s LMI a second time. This could potentially add thousands or tens of thousands of dollars in upfront costs to your mortgage, so it’s important to consider whether the financial benefits of refinancing may be worth these costs.

Is there a limit to how many times I can refinance?

There is no set limit to how many times you are allowed to refinance. Some surveyed RateCity users have refinanced up to three times.

However, if you refinance several times in short succession, it could affect your credit score. Lenders assess your credit score when you apply for new loans, so if you end up with bad credit, you may not be able to refinance if and when you really need to.

Before refinancing multiple times, consider getting a copy of your credit report and ensure your credit history is in good shape for future refinances.

Will I be paying two mortgages at once when I refinance?

No, given the way the loan and title transfer works, you will not have to pay two mortgages at the one time. You will make your last monthly repayment on loan number one and then the following month you will start paying off loan number two.

If I don't like my new lender after I refinance, can I go back to my previous lender?

If you wish to return to your previous lender after refinancing, you will have to go through the refinancing process again and pay a second set of discharge and upfront fees. 

Therefore, before you refinance, it’s important to weigh up the new prospective lender against your current lender in a number of areas, including fees, flexibility, customer service and interest rate.

Can I refinance if I have other products bundled with my home loan?

If your home loan was part of a package deal that included access to credit cards, transaction accounts or term deposits from the same lender, switching all of these over to a new lender can seem daunting. However, some lenders offer to manage part of this process for you as an incentive to refinance with them – contact your lender to learn more about what they offer.

What is a line of credit?

A line of credit, also known as a home equity loan, is a type of mortgage that allows you to borrow money using the equity in your property.

Equity is the value of your property, less any outstanding debt against it. For example, if you have a $500,000 property and a $300,000 mortgage against the property, then you have $200,000 equity. This is the portion of the property that you actually own.

This type of loan is a flexible mortgage that allows you to draw on funds when you need them, similar to a credit card.

What is an investment loan?

An investment loan is a home loan that is taken out to purchase a property purely for investment purposes. This means that the purchaser will not be living in the property but will instead rent it out or simply retain it for purposes of capital growth.

What are extra repayments?

Additional payments to your home loan above the minimum monthly instalments, which can help to reduce the loan’s term and remaining payable interest.

How does a line of credit work?

A line of credit functions in a similar way to a credit card. You have a pre-approved borrowing limit and can draw on as little or as much of that sum as you need it, with interest paid on the outstanding balance.

Popular products include Commonwealth Bank Viridian Line of Credit, ANZ Equity Manager, Westpac Equity Access and NAB Flexiplus.

What is equity? How can I use equity in my home loan?

Equity refers to the difference between what your property is worth and how much you owe on it. Essentially, it is the amount you have repaid on your home loan to date, although if your property has gone up in value it can sometimes be a lot more.

You can use the equity in your home loan to finance renovations on your existing property or as a deposit on an investment property. It can also be accessed for other investment opportunities or smaller purchases, such as a car or holiday, using a redraw facility.

Once you are over 65 you can even use the equity in your home loan as a source of income by taking out a reverse mortgage. This will let you access the equity in your loan in the form of regular payments which will be paid back to the bank following your death by selling your property. But like all financial products, it’s best to seek professional advice before you sign on the dotted line.

How do I apply for a home improvement loan?

When you want to renovate your home, you may need to take out a loan to cover the costs. You could apply for a home improvement loan, which is a personal loan that you use to cover the costs of your home renovations. There is no difference between applying for this type of home improvement loan and applying for a standard personal loan. It would be best to check and compare the features, fees and details of the loan before applying. 

Besides taking out a home improvement loan, you could also:

  1. Use the equity in your house: Equity is the difference between your property’s value and the amount you still owe on your home loan. You may be able to access this equity by refinancing your home loan and then using it to finance your home improvement.  Speak with your lender or a mortgage broker about accessing your equity.
  2. Utilise the redraw facility of your home loan: Check whether the existing home loan has a redraw facility. A redraw facility allows you to access additional funds you’ve repaid into your home loan. Some lenders offer this on variable rate home loans but not on fixed. If this option is available to you, contact your lender to discuss how to access it.
  3. Apply for a construction loan: A construction loan is typically used when constructing a new property but can also be used as a home renovation loan. You may find that a construction loan is a suitable option as it enables you to draw funds as your renovation project progresses. You can compare construction home loans online or speak to a mortgage broker about taking out such a loan.
  4. Look into government grants: Check whether there are any government grants offered when you need the funds and whether you qualify. Initiatives like the HomeBuilder Grant were offered by the Federal Government for a limited period until April 2021. They could help fund your renovations either in full or just partially.  

How do you qualify for a CBA home loan with casual employment?

Qualifying for a home loan without a full-time job may be challenging, but it can be done. The first step is to understand how a CBA home loan is assessed when you have casual employment.

Most lenders will assess your expenses and savings while checking your loan eligibility, checking on factors crucial to home loan approval, such as if your bills are paid on time and what your credit score presently looks like. 

Your income can be one of the most critical factors to determine your final approved home loan amount. As such, you’ll need to provide payslip copies to lenders to assist them in assessing your income during the loan tenure, regardless of your employment status, full-time, part-time, or otherwise.

Casual employees will want to be casually employed for at least 12 months to be eligible for a home loan. Alternatively, you want to have worked as a permanent casual worker (working for a fixed number of hours per week) for at least one month, or you should have been in your current job for a minimum of three months (if the hours are irregular) to be eligible for the loan.

Can I take a personal loan after a home loan?

Are you struggling to pay the deposit for your dream home? A personal loan can help you pay the deposit. The question that may arise in your mind is can I take a home loan after a personal loan, or can you take a personal loan at the same time as a home loan, as it is. The answer is that, yes, provided you can meet the general eligibility criteria for both a personal loan and a home loan, your application should be approved. Those eligibility criteria may include:

  • Higher-income to show repayment capability for both the loans
  • Clear credit history with no delays in bill payments or defaults on debts
  • Zero or minimal current outstanding debt
  • Some amount of savings
  • Proven rent history will be positively perceived by the lenders

A personal loan after or during a home loan may impact serviceability, however, as the numbers can seriously add up. Every loan you avail of increases your monthly installments and the amount you use to repay the personal loan will be considered to lower the money available for the repayment of your home loan.

As to whether you can get a personal loan after your home loan, the answer is a very likely "yes", though it does come with a caveat: as long as you can show sufficient income to repay both the loans on time, you should be able to get that personal loan approved. A personal loan can also help to improve your credit score showing financial discipline and responsibility, which may benefit you with more favorable terms for your home loan.

How do you determine which home loan rates/products I’m shown?

When you check your home loan rate, you’ll supply some basic information about your current loan, including the amount owing on your mortgage and your current interest rate.

We’ll compare this information to the home loan options in the RateCity database and show you which home loan products you may be eligible to apply for.

 

Who has the best home loan?

Determining who has the ‘best’ home loan really does depend on your own personal circumstances and requirements. It may be tempting to judge a loan merely on the interest rate but there can be added value in the extras on offer, such as offset and redraw facilities, that aren’t available with all low rate loans.

To determine which loan is the best for you, think about whether you would prefer the consistency of a fixed loan or the flexibility and potential benefits of a variable loan. Then determine which features will be necessary throughout the life of your loan. Thirdly, consider how much you are willing to pay in fees for the loan you want. Once you find the perfect combination of these three elements you are on your way to determining the best loan for you. 

Can I change jobs while I am applying for a home loan?

Whether you’re a new borrower or you’re refinancing your home loan, many lenders require you to be in a permanent job with the same employer for at least 6 months before applying for a home loan. Different lenders have different requirements. 

If your work situation changes for any reason while you’re applying for a mortgage, this could reduce your chances of successfully completing the process. Contacting the lender as soon as you know your employment situation is changing may allow you to work something out. 

Can you remove a cosigner from a home loan?

Taking out a home loan is an act of financial responsibility and a cosigner on a home loan shares that responsibility. For this reason, removing a cosigner from a home loan may not be straightforward. Usually, you can add a cosigner, or become a cosigner, when applying for the home loan. In such a circumstance, the lender may ask you to stipulate the conditions for a cosigner release, which are the terms for removing a cosigner from the home loan. For instance, you may agree that you can remove a cosigner once half the loan amount has been repaid.

However, not stipulating such conditions doesn’t mean it’s impossible to remove a cosigner. If the primary home loan applicant has a sufficiently high credit score and has not delayed any repayments, the lender may be willing to remove the cosigner. You should confirm that doing so doesn’t affect the terms of the loan. If the lender doesn’t agree to remove the cosigner, the primary home loan applicant may have to refinance the loan in order to do so. If there were specific reasons for needing a cosigner and those reasons are still valid, then you may have some challenges with refinancing.