Refinancing your home loan when starting a family

If you’re a soon-to-be parent, now is an ideal time to review your home loan and shop around for a better deal.

Refinancing your home loan when starting a familyAs you prepare for parenthood, you need to evaluate your lifestyle and start thinking long term. Now is a good time to assess your home loan to make sure your mortgage is fulfilling your needs, not only for you and your partner but for the little ones to come.

Trading in a high-interest home loan for a lower rate can lead to significant savings in the form of lower repayments and useful features that will better cater to your planned lifestyle. Refinancing is not only an opportunity to reap cost savings, it also offers a way to build equity and take advantage of more flexible terms and features.

Make sure you speak with a trusted mortgage broker and financial planner before making the change.

What you need to consider before refinancing

  • Lifestyle change. Before you refinance, decide whether your current property will satisfy your future lifestyle needs. Do you need to renovate and extend the property for an additional bedroom? Or will you need to move into a larger property down the track?
  • Budgeting. When you sit down to work out your budget, you’ll need to factor in the additional cost of having kids. Have you considered the cost of childcare and additional living expenses? Will you be able to afford your child’s education? How much time can you afford to take off work? Do you have a contingency buffer for unexpected medical costs? Make sure that you plan and budget according to your future needs. This is particularly important if you decide to take time out of the workforce following the arrival of your baby and your household income decreases as a result.
  • Finance options. If you’re thinking of having kids in the near future, you may want to scout for a home loan with lower rates or fees or a mortgage that allows you to access equity. A fixed rate mortgage may also be suitable if you want the certainty and security of knowing what your repayments will be month to month.

How soon-to-be parents can go about refinancing

Refinancing your home loan when starting a new family - 2

  • Review your needs. As you plan for your parenting years, you need to evaluate your lifestyle and budget and how this will impact your borrowing needs. Do you have enough room in your home to start a family? What degree of risk are you comfortable exercising with your finances? How can you protect your assets to ensure a financially stable future?
  • Check finances. Now is the time to speak with a financial planner about how you can build wealth for your family. It’s a good idea to lessen the burden of debt before the arrival of your child as this can give you a headstart. Refinancing can be an effective option for many soon-to-be parents, but you should also review your financial and investment strategies to consider alternative ways to build wealth such as a high-interest savings account, superannuation or property investing.
  • Speak up. Speak to your current lender to negotiate a lower rate. With a competitive home loan market, many banks are willing to negotiate a better interest rate in order to retain your business. However, if you find that the features or terms of your existing mortgage no longer fulfill your needs, then it may be time to move on.
  • Crunch the numbers. Estimate the cost of refinancing with a new lender. Keep in mind that you’ll need to pay a discharge fee (around $150-$350) to exit your current loan as well as upfront fees such as an application fee with your new lender. Use our switching cost calculator to get an estimate of your total refinancing cost. Remember to consult your accountant or financial planner to help you with the numbers.
  • Compare home loans. Speak with a mortgage broker to discuss the type of loan that will best complement your borrowing needs. Maybe you need a home loan with an offset account to help you reduce the amount of interest payable over the life of the loan, or maybe your priority is with a home loan that offers a portability feature if you decide to move to a larger property.

Compare competitive home loans today

Rates last updated April 19th, 2018
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Loan purpose
Offset account
Loan type
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Name Product Interest Rate (p.a.) Comp Rate^ (p.a.) Application Fee Ongoing Fees Max LVR Monthly Payment Short Description
3.64%
3.66%
$0
$0 p.a.
80%
Pay no ongoing fees and enjoy a flexible repayment schedule, including the ability to make unlimited additional repayments without penalty.
3.59%
3.60%
$0
$0 p.a.
90%
Borrow up to 90% of the value of your property and pay no ongoing fees with this loan from a leading international bank.
3.58%
3.58%
$0
$0 p.a.
70%
A low interest rate home loan with no application or ongoing fees.
3.69%
3.73%
$600
$0 p.a.
95%
Variable rate home loan from one of the big 4 banks. Available with just a 5% deposit.
3.49%
4.49%
$0
$395 p.a.
90%
Loans over $150k get a discount off an already low fixed rate. Available for NSW, Qld and ACT residents only.
3.69%
3.69%
$0
$0 p.a.
90%
Get a special discount for a limited time when you open an IMB Transaction Account. Face-to-face consultations available in NSW and ACT.
3.88%
4.89%
$0
$395 p.a.
95%
Low deposit home loan. Enjoy flexible repayment options while paying limited fees.
3.68%
3.69%
$0
$0 p.a.
95%
This variable rate loan offers flexible repayments and a redraw facility. Available with a 5% deposit.
3.52%
3.53%
$0
$0 p.a.
80%
Go from application to approval in as little as 20 minutes with a variable rate loan from this innovative online lender. Add a 100% offset account for $10 a month.
3.64%
3.67%
$0
$0 p.a.
80%
This loan offers a competitive variable rate and a 100% offset account to help save you on interest repayments.
3.49%
3.49%
$0
$0 p.a.
90%
Get a competitive variable rate with low fees. Add a 100% offset account for $10 a month. Available with a 10% deposit.
3.65%
3.66%
$0
$0 p.a.
90%
Offset up to $50,000 of the combined balances of your CUA Everyday Accounts and save on interest.
3.69%
3.69%
$0
$0 p.a.
80%
Enjoy flexible repayments, a redraw facility and the ability to split your loan. Plus, pay no application or ongoing fees. Refinance to a UBank loan and you could get $1,000 in your USaver account (offer conditions apply).
3.65%
3.66%
$0
$0 p.a.
80%
This special rate loan comes with no application or ongoing fees, and offers a flexible repayment schedule.
3.54%
3.58%
$0
$0 p.a.
80%
Eligible borrowers can get $1,200 cashback on this loan with a 100% offset account and a redraw facility.
3.77%
3.81%
$200
$0 p.a.
95%
A simplified mortgage with a low interest rate and a redraw facility.
3.64%
4.03%
$0
$395 p.a.
80%
New borrowers or refinancers from another lender get a discounted rate with this package loan.
3.62%
3.62%
$0
$0 p.a.
80%
Pay no application or ongoing fees and get access to a redraw facility and flexible repayment schedule. Refinance to a UBank loan and you could get $1,000 in your USaver account (offer conditions apply).
3.73%
3.73%
$0
$0 p.a.
80%
Get a 100% offset account and pay no application or ongoing fees on this special variable rate for owner-occupiers.
3.74%
3.74%
$0
$0 p.a.
110%
Pay no deposit or LMI and get a discounted rate with this family pledge loan. Requires a family member to act as guarantor. NSW, Qld and ACT only.
3.99%
3.74%
$0
$0 p.a.
90%
Borrow up to 90% of the value of the property you're buying, and pay no application fee.
3.74%
3.74%
$0
$0 p.a.
80%
Pay no application or ongoing fees and get access to a redraw facility and flexible repayment schedule.
3.64%
3.64%
$0
$0 p.a.
70%
Get a discount for keeping your LVR at 70% or below with this innovative online lender.
3.72%
3.74%
$0
$0 p.a.
80%
Save on interest by taking advantage of a 100% offset account along with no ongoing fees or application fees.
3.94%
3.57%
$0
$0 p.a.
80%
Apply online for this fixed rate, low-fee loan with redraw facilities and an optional offset account.
3.89%
3.91%
$0
$0 p.a.
80%
Borrow up to $2 million with this low investor rate. To get this discounted rate you must package the loan with your owner-occupier mortgage.
3.69%
4.47%
$0
$395 p.a.
90%
A fixed rate loan with a 100% offset account and the option to make additional repayments. Loans over $150k receive a discounted rate. NSW, QLD and ACT residents only.
3.70%
4.13%
$0
$395 p.a.
90%
Package your loan with an eligible credit card for discounts on rates and fees, and get a 100% offset account.
3.65%
4.84%
$0
$395 p.a.
90%
Pay no application fee for this package loan, and get access to a redraw facility. Face-to-face consultations available for NSW and ACT customers.
3.78%
3.78%
$0
$0 p.a.
80%
Pay no application or ongoing fees and get access to a free redraw facility with this innovative online lender.
4.19%
3.65%
$0
$0 p.a.
80%
Fast, 100% online application process. Very limited fees. Optional offset account (with fee).
3.97%
4.02%
$445
$0 p.a.
90%
Buy a home with just a 10% deposit with this variable rate loan. Face-to-face consultations available for NSW and ACT customers.
4.09%
4.12%
$0
$0 p.a.
90%
Access a fee-free offset account and a special interest rate for investors.
3.69%
4.11%
$0
$395 p.a.
80%
Save on interest with a 100% offset account and save on other ME products with this package loan.
3.97%
3.97%
$0
$0 p.a.
90%
A variable rate loan with a 100% offset account. Available with a 10% deposit.Face-to-face consultations available for NSW and ACT customers.
3.89%
4.87%
$0
$0 p.a.
90%
Borrow up to 90% of the value of the property you're buying and pay no application or ongoing fees.
4.14%
4.81%
$0
$0 p.a.
80%
Pay no application fees and access a fee-free redraw facility with this fixed rate loan.
4.19%
4.19%
$0
$0 p.a.
90%
100% offset account, unrestricted additional repayments and no monthly account keeping fees
3.89%
3.92%
$0
$0 p.a.
80%
A low-fee line of credit loan from an online lender. Unlock the equity in your home and make interest-only repayments with a competitive rate.
3.62%
3.62%
$0
$0 p.a.
95%
Free home and contents insurance for 1 year. Terms and conditions apply. QLD residents only.
3.99%
4.86%
$0
$0 p.a.
80%
Access a fee-free 100% offset account and pay no application or ongoing fees.
3.85%
4.05%
$0
$350 p.a.
95%
This high LVR fixed rate loan allows you to borrow up to 95% of the value of the property you're buying.
4.09%
4.11%
$0
$0 p.a.
80%
This variable rate loan keeps the features simple and fees low. This loan is offered by a 100% online lender.
3.64%
3.67%
$0
$0 p.a.
80%
A mortgage with a competitive variable rate, limited fees and plenty of flexibility.
3.69%
4.06%
$0
$349 p.a.
90%
Package your loan with other AMP products and save on rates and fees.
3.68%
3.83%
$0
$10 monthly ($120 p.a.)
80%
Get a 100% offset account to save on interest charges, and pay no application fee.
3.69%
3.71%
$0
$0 p.a.
80%
A great interest rate home loan offer with unlimited redraw and unlimited extra payments.
3.64%
3.78%
$0
$10 monthly ($120 p.a.)
80%
Earn Velocity Points on your mortgage (for a limited time, subject to eligibility requirements). Plus, access a 100% offset account to save on interest.
4.09%
4.12%
$0
$0 p.a.
95%
Buy a home with just a 5% deposit and get flexible repayment options and a redraw facility.
3.69%
3.69%
$0
$0 p.a.
70%
Pay no application or ongoing fees and get a flexible loan with the ability to split up to 6 times.
3.99%
4.03%
$0
$0 p.a.
95%
Buy a home with just a 5% deposit and pay no application or ongoing fees.
3.59%
4.42%
$600
$0 p.a.
95%
Get a 1% discount for the first two years of your loan and pay no application or ongoing fees.
3.68%
3.69%
$0
$0 p.a.
90%
Get one free online redraw per month and pay no ongoing fees. Application fees are waived for loans above $150,000.
3.79%
3.79%
$0
$0 p.a.
80%
A competitive variable rate for owner-occupiers who've saved a 20% deposit. Limited fees.
4.39%
5.42%
$300
$10 monthly ($120 p.a.)
95%
Lock in a fixed interest rate term for repayment certainty.
3.89%
4.97%
$0
$395 p.a.
95%
Get discounts on a range of Commonwealth Bank products and enjoy the option of fee-free extra repayments during the fixed term.
3.89%
4.96%
$0
$395 p.a.
95%
Refinancers can get $1,500 cashback. Conditions apply. Package your home loan with a Qantas rewards earning Amplify credit card.
3.89%
4.88%
$0
$395 p.a.
95%
Refinance from your existing loan and get a $1,250 rebate. Terms and conditions apply. Plus get discounts on a range of Westpac products.

Compare up to 4 providers

Planning for parenthood is an exhilarating time, which is why it pays to reconsider your home loan and opt for a more competitive product so you can secure your family’s future.

Images: Shutterstock

Belinda Punshon

Belinda is a journalist here at finder.com.au. Specialising in the home loans and property sections, she is passionate about helping Australians improve their financial wellbeing.

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Pay no application or ongoing fees and get access to a redraw facility and flexible repayment schedule. Refinance to a UBank loan and you could get $1,000 in your USaver account (offer conditions apply).

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