refinacepersonalloan_shutterstock_feat

How to refinance your personal loan

Find out how refinancing works and if it can help save you money.

If you're struggling with multiple loans or have found a better loan offer, you can use refinancing to consolidate your debt and help reduce the cost of your loan.

See if refinancing is right for you and compare loan options below.

What is personal loan refinancing?

Personal loan refinancing involves taking out a new loan to cover the cost of your previous loan. It's generally used by those with multiple loans as a way to consolidate debt into one loan, which is then paid off instead.

If you find a personal loan that has a more competitive rate than your existing loan, you can also use it to refinance and help reduce the cost of your loan.

How does personal loan refinancing work?

Refinancing a personal loan works much in the same way as refinancing a home loan. You apply for a new loan which covers the amount you have left to pay on your current loan(s) and use the funds to pay off this existing loan. Some lenders can organise the funds to be paid directly to the other lender on your behalf.

You will still have the same amount of debt, but will be saving money if the new loan offers better terms, lower fees or a reduced interest rate than your existing loan.

Citi Personal Loan Plus

Citi Personal Loan Plus

From

8.99 % p.a.

variable rate

From

9.67 % p.a.

comparison rate

  • Loan amounts from $5,000
  • Offers a reusable credit facility
  • Repay over 5 years
Security Logo

100% confidential application

Citi Personal Loan Plus

A reusable credit facility of up to $75,000. Receive a tailored interest rate between 8.99% p.a. and 17.99% p.a. (9.67% p.a. to 18.6% p.a. comparison rate) based on your risk profile.

  • Interest rate from: 8.99% p.a.
  • Comparison rate: 9.67% p.a.
  • Interest rate type: Variable
  • Application fee: $0 ($199 establishment fee waived)
  • Minimum loan amount: $5,000
  • Maximum loan amount: $75,000
Go to site
Promoted

Compare the personal loan refinance options below

Rates last updated April 20th, 2019
$
Name Product Interest Rate (p.a.) Comparison Rate (p.a.) Min Loan Amount Loan Term Application Fee Monthly Service Fee Product Description Monthly Repayment
Citi Personal Loan Plus
From 8.99% (variable)
9.67%
$5,000
3 to 5 years
$0 ($199 establishment fee waived)
$10
You'll receive a variable rate between 8.99% p.a. and 17.99% p.a. (9.67% p.a. to 18.6% p.a. comparison rate) based on your risk profile
A credit limit up to $75,000 that you can continue to draw down over terms up to 5 years. Note: The establishment fee will be waived if you apply before 30 June 2019.
NAB Personal Loan Unsecured Fixed
Headline rate 12.69% (fixed)
13.56%
$5,000
1 to 7 years
$150
$10
You'll receive a fixed rate between 10.69% p.a. and 18.69% p.a. based on your risk profile
An unsecured loan up to $55,000 you can use for a range of purposes and pay off over up to 7 years.
RateSetter Unsecured Personal Loan - 3yr Fixed
From 7.38% (fixed)
9.39%
$2,001
0.5 to 5 years
$299
$0
You'll receive a fixed rate from 7.38% p.a. based on your risk profile
A flexible loan with amounts from $2,001 and terms starting from 6 months. Interest and comparison rates calculated for a loan term of 3 years.
Westpac Unsecured Personal Loan
12.99% (fixed)
14.14%
$4,000
1 to 7 years
$250
$12
You'll receive a fixed rate of 12.99% p.a.
Benefit from the security of a fixed rate with the flexibility of additional repayments. Existing Westpac customers may qualify for discounts.
ANZ Fixed Rate Personal Loan
12.45% (fixed)
13.32%
$5,000
1 to 7 years
$150
$10
You'll receive a fixed rate of 12.45% p.a.
Apply for up to $50,000 to use for a variety of purposes without needing to add security. Available to self-employed applicants.
Latitude Personal Loan (Unsecured)
From 13.99% (fixed)
15.19%
$3,000
2 to 7 years
$250 (Loans under $4000 - $140)
$13
You'll receive a fixed rate between 13.99% p.a. and 29.99% p.a. based on your risk profile
Apply for what you need from $3,000 and use it for a range of purposes. Flexible repayments options.
NOW FINANCE Personal Loans
From 8.95% (fixed)
10.56%
$5,000
1.5 to 7 years
$495 (Based on $10,000)
$13
You'll receive a fixed rate between 8.95% p.a. and 16.95% p.a. based on your risk profile
Apply for loans from $5,000 and get a dedicated loan manager. No security required.
Latitude Low Rate Personal Loan (Unsecured)
10.99% (fixed)
12.21%
$20,000
2 to 7 years
$250
$13
You'll receive a fixed rate of 10.99% p.a.
A secured or unsecured loan available to homeowners with a large minimum borrowing amount of $20,000. Benefit from flexible repayments and fast approval.
St.George Unsecured Personal Loan - Fixed Rate
From 12.99% (fixed)
14.06%
$2,000
1 to 5 years
$195
$12
You'll receive a fixed rate between 12.99% p.a. and 18.9% p.a. based on your risk profile
A low minimum borrowing amount of $2,000 to fund a range of purposes.
RACQ Bank Unsecured Personal Loan
12.95% (variable)
13.25%
$3,000
5 years
$200
$0
You'll receive a variable rate of 12.95% p.a.
A low minimum borrowing amount of $3,000 that you can use for a range of purposes. Benefit from member discounts and flexible repayments. Only available to QLD residents
CUA Unsecured Fixed Rate Personal Loan
9.89% (fixed)
10.14%
$5,000
1 to 7 years
$175
$0
You'll receive a fixed rate of 9.89% p.a.
An unsecured loan from $5,000 with flexible repayments and no monthly fee.
ANZ Variable Rate Personal Loan
15.99% (variable)
16.84%
$5,000
1 to 7 years
$150
$10
You'll receive a variable rate of 15.99% p.a.
A flexible loan with amounts starting $5,000 that offers flexible repayments and a redraw facility.
NAB Personal Loan Unsecured Variable Rate
Headline rate 12.69% (variable)
13.56%
$5,000
1 to 7 years
$150
$10
You'll receive a variable rate based on your risk profile. The headline rate is 12.69% p.a.
An unsecured loan up to $55,000 you can use for a range of purposes. Benefit from fee-free additional repayments and a redraw facility.
St.George Unsecured Personal Loan - Variable Rate
From 12.99% (variable)
14.06%
$2,000
1 to 7 years
$195
$12
You'll receive a variable rate between 12.99% p.a. and 18.9% p.a. based on your risk profile
A low minimum borrowing amount of $2,000 plus the convenience to make extra repayments and redraw them if you need them.
CUA Unsecured Variable Personal Loan
11.89% (variable)
12.15%
$5,000
1 to 7 years
$175
$0
You'll receive a variable rate of 11.89% p.a.
Borrow from $5,000 with the option for flexible repayments and no monthly fees.
CUA Discount Variable Personal Loan (Loans over $30,000)
10.89% (variable)
11.15%
$30,000
1 to 7 years
$175
$0
You'll receive a discounted variable rate of 10.89% p.a.
Borrow over $30,000 and receive a discounted interest rate. No monthly fees and a redraw facility also available.
MyState Bank Unsecured Personal Loan
12.99% (variable)
16.42%
$3,000
1 to 7 years
$200
$10
You'll receive a variable rate of 12.99% p.a.
Apply for up to $50,000 and benefit from features such as fast approval, free online redraws and no penalties for early repayment.

Compare up to 4 providers

Why should I refinance my personal loan?

There are a few reasons why people choose to refinance their personal loans, but really it boils down to either finding a better deal or consolidating debts.

  • You've found a better deal. If you think you've found a better deal it might be worth using a personal loan repayment calculator, such as the one below, to compare the two loan options and see if the move will be worth it. When comparing loans you shouldn't just focus on interest rates, but also look at ongoing fees and repayments as well as loan establishment costs. You should also consider the features of a loan to make sure they suit your needs. For example, if you sometimes make additional repayments you should confirm whether this is allowed with the new loan.
  • You're consolidating debt. If you are refinancing a personal loan to consolidate a debt then you will need to do a few more calculations. First, you should calculate the total monthly repayments for each of your existing loans. This should include fees, rates and any other charges you incur from your loan. You should then compare this figure to what you can expect to pay for the new consolidated loan. Using a personal loan repayment calculator as mentioned above can simplify this process.

Will you save by refinancing your personal loan?

If you've already compared personal loans and would like to compare the two side by side, we've provided a loan comparison calculator below.

How do I refinance my personal loan?

  1. Compare your personal loan options: Take a look at what personal loans are available to see if you can get a better deal.
  2. Calculate the costs of refinancing: Include break and exit fees and the establishment fees for your new loan to ensure it will be worth your while.
  3. Apply for the new personal loan: If you meet the criteria for the new personal loan, submit your application. You may have to note that your loan purpose is to refinance or consolidate.
  4. Pay out your current loan with the funds from the new loan: If the loan is for debt consolidation your lender may be able to arrange this for you, but for other lenders, you will need to transfer the funds from your new loan into your current personal loan account.
  5. Make sure the old loan is closed: Confirm with your previous lender that your loan account is closed and you have no balance owing.

What are the costs of refinancing a personal loan?

Banks and lenders don't want you jumping ship every time you see a cheaper rate from a competitor, which is why refinancing comes with a cost. Here are some fees to take into account when you're calculating the costs of refinancing:

  • Application fees could set you back as much as $300, so confirm if you will be charged a fee on the new loan.
  • Early repayment fees are sometimes charged by lenders and can put a considerable dent in the savings you could make from switching.
  • Ongoing fees are also a cost that should be taken into consideration. These fees can add up quite quickly and may offset a lower rate offered by the new loan.

Is it worth refinancing your personal loan?

The value of refinancing will depend on your current personal loan and also your financial situation. To determine the value of refinancing you should calculate what your current loan/s are costing you and then compare that to the cost of your new loan. Remember to include the initial costs for setting up a loan and also the interest you will save over the life of the loan, not just in the initial period.

You should also consider other features of the loan when deciding whether to refinance. For example, if you are refinancing from a fixed rate loan to a variable rate loan you may save money as long as the variable rate lasts, but these rates are called variable for a reason. The rate could change and then you may discover you would have been better off staying with the first loan.

The same goes for other features of the loan, for example, you may be used to making additional repayments to pay your loan back sooner, but the new loan you refinance to may not have this option, or may charge you for it.

When determining the value of refinancing, remember to take all aspects of both loans into consideration.

Picture: Shutterstock

Was this content helpful to you? No  Yes

Related Posts

Personal Loan Offers

Important Information*
Citi Personal Loan Plus

You'll receive a variable rate between 8.99% p.a. and 17.99% p.a. (9.67% p.a. to 18.6% p.a. comparison rate) based on your risk profile
A credit limit up to $75,000 that you can continue to draw down over terms up to 5 years. Note: The establishment fee will be waived if you apply before 30 June 2019.

NAB Personal Loan Unsecured Fixed

You'll receive a fixed rate between 10.69% p.a. and 18.69% p.a. based on your risk profile
An unsecured loan up to $55,000 you can use for a range of purposes and pay off over up to 7 years.

RateSetter Unsecured Personal Loan - 3yr Fixed

You'll receive a fixed rate from 7.38% p.a. based on your risk profile
A flexible loan with amounts from $2,001 and terms starting from 6 months. Interest and comparison rates calculated for a loan term of 3 years.

Westpac Unsecured Personal Loan

You'll receive a fixed rate of 12.99% p.a.
Benefit from the security of a fixed rate with the flexibility of additional repayments. Existing Westpac customers may qualify for discounts.

Ask an Expert

You are about to post a question on finder.com.au:

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com.au is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms of Use, Disclaimer & Privacy Policy and Privacy & Cookies Policy.

2 Responses

  1. Default Gravatar
    DanApril 1, 2019

    Hi, I’ve got a loan of $35k+ currently with a 16.4%pa variable interest rate received about 4 years ago when my income was $40k/year less than now. Can I negotiate my loan amount with my big 4 bank lender? Or would I be better off with another lender?

    • finder Customer Care
      MaiApril 2, 2019Staff

      Hi Dan,

      Thank you for contacting Finder.

      While you can negotiate home loans, you can also try if that could also be available for personal loans if you are to refinance. To help you with negotiating, it may be a good idea to take a look around to see what interest rates are currently offering to new customers by the big four and other lenders too. This may help you work out if you’re getting a good deal and it will also strengthen your argument when it comes time to talk to the bank for possible negotiation.

      Hope this helps.

      Kind Regards,
      Mai

Ask a question
Go to site