Refinancing your home loan can be a smart move when managed correctly. Whether you’re chasing a better rate, accessing equity, or consolidating debt, understanding the process is key. Here’s a step-by-step guide to help you refinance with confidence.
Start with Research: Review and Compare Loans
You may have seen a great interest rate advertised—but before making any moves, take time to research a few different home loans.
Look beyond the interest rate. Compare upfront and ongoing fees, features like offset accounts, and importantly, the comparison rate—which includes most fees and charges combined into one percentage figure. This gives a more accurate reflection of the true cost of each loan.
Make a list of the features you need in your new loan, and compare lenders online to find the best fit for your goals.
Get Your Finances in Order
Being prepared with your financial information can make the application process smoother. You’ll need to provide:
- Recent pay slips or proof of income
- Bank and credit card statements
- Details of any current loans or debts
- A breakdown of your current mortgage – interest rate, repayments, fees, and any exit or discharge charges
With these details on hand, you can work out how much you need to borrow—and how much you can borrow. Try our borrowing power calculator or speak with one of our lending specialists for tailored advice.
Apply Through a Broker or Lender
Once you’ve found a loan that suits your needs, it’s time to apply. This can be done directly with a lender or through a mortgage broker—either in person, online or over the phone.
During the application, you’ll need to supply your property details, income and expense information, and current loan details. If approved, the lender may issue conditional approval, which may be subject to further checks—like a property valuation or additional documents.
Once these conditions are met, formal approval is granted and the process moves forward.
Review Your Loan Offer Carefully
Before signing anything, make sure you fully understand the loan terms. Take your time to read through the loan agreement and don’t hesitate to ask questions.
This is a significant financial decision—so if something doesn’t feel right, or you’re unsure about any clause, you’re under no obligation to proceed. You always have the option to walk away.
Settlement Day
Once everything is approved, your new lender will schedule a settlement date. This is when your old mortgage is closed out and replaced by the new one. If you’re staying with the same lender, it may simply involve switching products.
From here, your new loan takes effect—and you’re officially refinanced!
Tips for a Smooth Refinance
Factor in the Costs
Refinancing isn’t always free. Here are common fees you might encounter:
- Application/Establishment Fee – Cost to set up the new loan
- Valuation Fee – Professional property valuation cost
- Settlement Fee – Covers admin costs at settlement
- Title Protection Fee – Protects against title fraud during transfer
- Discharge/Exit/Break Fees – Your previous lender may charge these
- Government Fees – May include mortgage registration or stamp duty
- Ongoing Fees – Monthly or annual fees with your new loan
- Lender’s Mortgage Insurance (LMI) – May apply if borrowing over 80% of property value
Make sure to weigh up all of these costs before switching.
Be Mindful of Your Credit Score
Each time a lender checks your credit file, it’s recorded. Too many applications in a short period can affect your credit rating. So, avoid applying for multiple loans at once. Instead, do your research first and apply only when ready.
Borrow Responsibly
A tempting loan offer can sometimes encourage over-borrowing. But remember:
- Interest rates can change
- Fixed rates have end dates
- Life circumstances can shift
Always choose a loan and repayment level that you can comfortably afford—both now and in the future.
