Refinancing can sometimes seem a bit overwhelming, but it can also help you reduce your repayments and pay off your home sooner. Here’s some handy tips to help you prepare for conversations with your potential lender. 

Start by blocking out some time to familiarise yourself with your current loan so that you can answer the following questions: 

• What is your current interest rate? 

• How does this compare with other rates advertised in the market? 

• If you have a fixed rate, when does it expire and what is the variable rate that will apply on expiry? 

• What is your home currently worth based on recent comparable sales in your neighbourhood? 

• How much do you still owe?  

• Are you using all the features of your loan? For instance, does your loan have an offset account and are you using that? Are you making additional repayments on your loan? 

• Do you have any other outstanding debts, such as personal or car loans? 

Being able to answer these simple questions will help you when you’re ready to talk with potential lenders.  

Identify your needs  

Your potential lender will ask you questions about what you need from a loan, so it’s good to be prepared. Things to consider:    

• Do you want the option to make additional repayments? 

• Do you need to be able to redraw these additional repayments? 

• Do you need certainty of repayments, such as a fixed rate loan, or are you willing to go to a variable rate? 

Plan ahead  

Refinancing can take time and it may take up to eight weeks or more after application for your loan to change over. If you’re coming off a fixed rate loan, don’t wait until the last minute to review your options or you may find yourself paying a higher interest rate for longer than you need to. Keep this in mind when you’re planning your budget for the months ahead. 

Consider costs  

There are fees and charges associated with refinancing. Be sure to consider these and weigh them against any potential savings to make sure you will come out ahead. 

Size up your serviceability  

As interest rates change, the amount you can borrow may also change. There are ways to improve your serviceability, such as lowering credit limits or closing unused credit cards. A lender can help you understand your serviceability and steps you may be able to take to improve it. 

Know your values 

How much you need to borrow compared to the value of your home can also impact the loans and interest rates you are eligible for. If you have paid off a lot of your loan or your home has risen significantly in value, you may be eligible for a lower interest rate. 

Speak to a lender 

Understanding whether it’s worth refinancing can seem overwhelming and difficult, but the simple act of picking up the phone or making an appointment to speak to a lender can be the first step in overcoming your concerns.  

Schedule a home loan health check with your Health Professionals Bank Mobile Banker. 

Click here to learn more. 

Important Information 

This information is general in nature and does not take your personal objectives, financial circumstances or needs into account. Consider its appropriateness to these factors before acting on it and seek professional advice before deciding. 

Membership eligibility applies to join the Bank. All applications for credit are subject to our responsible lending criteria. Fees and charges apply. You can find our Consumer Lending terms and conditions available online or from any of our offices. Health Professionals Bank is a division of Teachers Mutual Bank Limited ABN 30 087 650 459 AFSL/Australian Credit Licence 238981.s