If you’ve had a mortgage for a few years, there is a good chance that your needs have also changed over this time, meaning your current home loan may not be the best fit anymore. Re-evaluating your home loan can lead you to consider refinancing, which basically means you are taking out a new loan to pay off the original one. There are many reasons why you should consider refinancing your home loan, so here are our top three:
1. Debt consolidation
If you have more debt than you can keep track of, then refinancing may be the right option for you, as it provides an opportunity to combine your home loan with other debts you may have, such as a credit card or a personal loan. By doing so, you may be able to pay off all your debts at once, move to a better priced home loan, and potentially reduce your monthly repayments.
2. Switching to a loan that meets your needs
The best home loan for you when you first bought your home may not be the best home loan for you today. You may want the security of a fixed rate home loan, or the lower interest rate of a variable rate home loan. Maybe you’d like to explore the possibility of a redraw facility, an offset account or the convenience of loan portability. Your home loan should be working for you, not the other way around!
3. Secure a lower interest rate
Switching to a lower interest rate can reduce your monthly loan repayments, and the time it takes to pay off your loan. However, there can be unexpected costs, such as Lender’s Mortgage Insurance and stamp duty, so make sure to weigh up the expense against the potential savings to make sure it’s worth it.
If you’re interested in refinancing your home loan, head over to our website here to fill out a refinance enquiry and one of our EasyPlan Home Loan Specialists will find the perfect loan to suit your needs, saving you the hassle of trying to sort through hundreds of loan options by yourself.