When is the best time to refinance my mortgage?

Refinancing your home loan can lead to significant cost savings, but there are some key factors to consider before deciding whether it's the right time to make a move.

Last updated:

refinance your home loanIf you're thinking of refinancing, time is of the essence.

Refinancing your mortgage is not only an opportunity to reduce your periodic repayments, it also provides an avenue to access equity or restructure your mortgage so it better suits your lifestyle.

Whether you've found a better interest rate, your mortgage no longer satisfies your needs or you've experienced a major lifestyle change, many Australians are refinancing to take advantage of money-saving features in the competitive home loan market-- but when is the right time to make the change?

There is no 'one size fits all' in terms of the recommended time that you should refinance.

Rather, you should assess your personal and financial situation to see if there are any signs that suggest that it may be a good time to refinance (don't worry, we'll point you in the right direction).

Generally, you should conduct a financial health check at least once a year to see if your home loan is meeting your needs. Switching to a home loan that is even 0.5% lower than your current rate could save you thousands over the course of your loan.

If you're opting for a better interest rate, consider negotiating with your current lender as most banks are willing to offer customers a rate discount in order to retain your business.

Here's some general advice about how you can decide when to refinance your home loan.


When is the right time to refinance?

Deciding the right time to refinance your home loan will depend on your personal and financial situation, such as your job security and earning potential, among other factors. Speak with an experienced mortgage broker, accountant or financial adviser to help you decipher the best time to refinance.

Generally, the following may suggest that it is a good time to refinance:

  • Non-competitive interest rate. When you're lender's interest rate is no longer competitive. Use our home loan comparison tables to compare different rates available on the market so you can lower your monthly repayments and interest charges.
  • Interest rate rise. If you believe that the Reserve Bank or your lender will raise interest rates in the near future it may be a good time to scout for a competitive loan that offers a lower rate and other money-saving features such as a free redraw facility or an offset account. Please note that your refinancing decision should not be based on interest rate predictions alone as interest rates fluctuate regularly and are subject to a range of economic conditions.
  • Job security. Most lenders prefer borrowers to have been in the same job for the past 12 months as this indicates a reliable and steady income source. If this is the case, you may be in a stronger position to refinance as you will be considered a low-risk borrower (given that you meet all other eligibility requirements).
  • Consolidate debt. If you're finding it difficult to meet your debt payments, you may want to consolidate your personal debts into your mortgage so that you have one manageable repayment, instead of several. If structured correctly, consolidating your debts into your home loan can be an effective way to minimise your repayments if you make an effort to repay the loan as soon as possible.

Learn more about the refinancing process to decide whether this is the best solution for you.


According to Dominique Bergel Grant, founder of Leapfrog Finance, there are certain factors that may impact you directly when it comes to deciding the right time to refinance.

Dominique Bergel Grant

  • Founder of Leapfrog Finance
  • Financial Adviser and Mortgage Broker
  • Has worked in the financial services industry since 1999 and strives to provide her clients financial security and success

Factors that impact you directly

  • Income change. If you have a loss of income or you're faced with unexpected expenses, these factors may inhibit your borrowing capacity and your serviceability potential. As a result, you may not feel confident refinancing your mortgage during this time of uncertainty.
  • Lifestyle change.If you anticipate a significant lifestyle change, such as if you're planning a renovation or thinking of starting a family, some features of your existing mortgage may not be useful anymore and you may prioritise new features instead such as an offset account or a redraw facility. For instance, you may want to switch to a split-rate loan to take advantage of a low variable rate while still maintaining the security of a fixed rate as this will offer greater financial security for your renovation project or for the future of your family.

It's not all about the interest rate

While some borrowers refinance to lower their repayments by finding a better interest rate, Bergel Grant says that when it comes to refinancing your mortgage, it's important to ensure that you're getting the right features. She points out that you should check that you're not paying for features that you don't use.

'Mortgages with more features can seem to cost a bit more in fees and interest, however in the long run they have benefits than can save you thousands.' Dominique Bergel Grant, founder of Leapfrog Finance


The cost of refinancing

The cost of refinancing your home loan will influence your decision about whether or not now is the right time for you to switch lenders. You'll need to account for discharge fees ($150 - $350) charged by your current lender as well as any upfront application fees charged by the new lender.

Use our switching cost calculator to estimate your total refinancing costs. Remember to consult your accountant or financial planner to assist you with these calculations.

Refinancing can be a smart move if you take the time to research your options and weigh up the benefits and risks involved. Speak with experienced professionals such as a mortgage broker and a financial planner to help you decide on the timing of your refinance application.

Compare and switch to one of these mortgage offers

Rates last updated October 18th, 2019
$
% p.a.
Offset account
Split account
Loan type
Your filter criteria do not match any product
Name Product Interest Rate (p.a.) Comp Rate^ (p.a.) Application Fee Ongoing Fees Maximum Insured LVR Amount Saved Short Description
2.84%
2.84%
$0
$0 p.a.
80%
This rate will drop to 2.84% p.a on 29 October 2019 for new and existing customers. Enjoy flexible repayments, a redraw facility and the ability to split your loan. Plus, pay no application or ongoing fees.
2.84%
2.80%
$0
$0 p.a.
80%
Owner occupiers looking to refinance can get one of the lowest rates in the market with this variable rate mortgage. $0 application fee and $0 ongoing fees. Refinancers only.
2.84%
2.97%
$600
$10 monthly ($120 p.a.)
70%
A very low variable interest rate for home buyers with a 30% deposit. This product has a 100% offset account.
2.99%
3.45%
$0
$10 monthly ($120 p.a.)
90%
Buy your home and lock in a low rate for the first two years. Available with a 10% deposit. Earn Velocity Frequent Flyer Points at settlement, monthly and every three years, plus extra bonus points for a limited time.
3.24%
3.20%
$0
$0 p.a.
80%
Athena offers one of the lowest rates in the market for investors looking to refinance their mortgage. No ongoing fees and no application fee. Principal and interest repayments. Refinancers only.
2.89%
2.93%
$600 (refundable)
$0 p.a.
70%
This variable rate loan has a very competitive rate for home buyers and refinancers with a 30% deposit.
3.33%
3.47%
$0
$10 monthly ($120 p.a.)
80%
This flexible, competitive variable rate mortgage comes with a redraw facility. Eligible borrowers can earn Velocity Frequent Flyer Points, plus extra bonus points for a limited time.
2.94%
2.97%
$600
$10 monthly ($120 p.a.)
80%
A competitive variable rate for home buyers with a 20% deposit. This product has a 100% offset account.
2.88%
3.80%
$0
$395 p.a.
80%
Lock in a competitive rate for owner occupiers for two years. Comes with a 100% offset account.
3.39%
4.29%
$600
$395 p.a.
95%
A package loan that offers discounts and a 100% offset account.
3.31%
3.37%
$449
$0 p.a.
90%
NSW and ACT customers only. Get a special discount for a limited time when you open an IMB Transaction Account.
3.29%
3.70%
$0
$395 p.a.
80%
A low rate variable mortgage for home buyers. Comes with a 100% offset account and has no application fee.
3.15%
4.07%
$600
$0 p.a.
95%
Fix your rate for the first two years with this competitive, low-fee loan. Includes a 100% offset account. Get this loan with a 5% deposit.
3.33%
4.37%
$0
$0 p.a.
80%
Pay no application fees and access a fee-free redraw facility with this fixed rate loan.
3.02%
3.04%
$0
$0 p.a.
90%
This rate is effective from 21 October for all HSBC customers. Get a low interest rate loan with no ongoing fees. Plus you can make extra repayments and free redraw online. Available with just a 10% deposit.
2.74%
3.61%
$395
$0 p.a.
80%
Fix your mortgage for 1 year with a very competitive rate and no ongoing fees.
2.88%
4.11%
$0
$375 p.a.
95%
$2,000 cashback for eligible refinancers. Get a very low fixed interest rate for two years plus package discounts. Available with a 5% deposit.
3.34%
2.99%
$0
$0 p.a.
80%
Owner occupiers can refinance to one of the most competitive interest-only rates in the market. No application fee and no ongoing fees. Refinancers only.
3.69%
4.58%
$600
$395 p.a.
95%
A package loan that offers discounts and a 100% offset account.
2.69%
3.37%
$395
$0 p.a.
80%
A competitive fixed interest rate product with no ongoing bank fees.
3.34%
3.78%
$0
$395 p.a.
80%
Unlock a range of savings with this competitive package home loan offer. Offset account and redraw facility included.
3.24%
3.24%
$0
$0 p.a.
95%
$2,000 cashback for eligible refinancers. This flexible, basic home loan offers a very low rate and you only need a 5% deposit.
3.49%
4.11%
$300
$10 monthly ($120 p.a.)
80%
Special offer for new lending between $150k-$500k & under 80% LVR.
3.57%
3.59%
$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.
2.89%
3.62%
$395
$0 p.a.
80%
A one year fixed rate offer with no ongoing bank fees.
3.32%
3.71%
$0
$395 p.a.
90%
New borrowers or refinancers can get a discounted rate with this package loan.
2.84%
3.47%
$449
$6 monthly ($72 p.a.)
90%
NSW and ACT customers only. 3 years fixed interest terms and free access to redraw facility online.
3.03%
4.43%
$0
$0 p.a.
80%
Get a low fixed rate and pay no application or ongoing fees.
3.15%
3.19%
$500
$0 p.a.
95%
This mortgage combines a very sharp interest rate with a 100% offset account and it's available with a 5% deposit.
3.09%
4.39%
$595
$0 p.a.
95%
Borrow up to 95% LVR of the value of the property you're buying and pay no ongoing fees.
3.09%
4.52%
$595
$0 p.a.
90%
Investors can take advantage of a short term fixed rate with no ongoing fees.
2.84%
3.41%
$395
$0 p.a.
80%
A competitive 3 year fixed rate with no ongoing bank fees.
3.74%
$0
$349 p.a.
80%
Low fee line of credit loan with package benefits.
3.04%
4.08%
$395
$0 p.a.
80%
Investors can enjoy flexible repayments and an easy application process with this pioneering online lender.
3.84%
4.16%
$0
$299 p.a.
80%
Get a 100% offset account, access to a redraw facility and a competitive rate tied to your LVR.
3.94%
3.93%
$0
$10 monthly ($120 p.a.)
80%
A variable rate home loan with no application fees and the opportunity to earn Velocity points.

Compare up to 4 providers

Aussie Home Loans Logo

Enter your details below to receive an obligation-free quote from an Aussie mortgage broker today

By submitting this form, you agree to the Finder Privacy and Cookies Policy and Terms of Use

Applications are subject to approval. Conditions, fees and charges apply. Please note that you need to be an Australian citizen or permanent resident to apply.

Credit services for Aussie Select products are provided by AHL Investments Pty Ltd ACN 105 265 861 (“Aussie”) and its appointed credit representatives, Australian Credit Licence 246786. Aussie is a trade mark of AHL Investments Pty Ltd. Aussie is a subsidiary of the Commonwealth Bank of Australia ABN 48 123 123 124. © 2019 AHL Investments Pty Ltd ABN 27 105 265 861 Australian Credit Licence 246786. Credit for Aussie Select products is provided by Residential Mortgage Group Pty Ltd ACN 152 378 133, Australian Credit Licence 414133 (“RMG”). RMG is a wholly-owned subsidiary of the Commonwealth Bank of Australia ABN 48 123 123 124 AFSL and Australian Credit Licence 234945.

Aussie is a trade mark of AHL Investments Pty Ltd. Aussie is a subsidiary of the Commonwealth Bank of Australia ABN 48 123 123 124. ©2018 AHL Investments Pty Ltd ABN 27 105 265 861 Australian Credit Licence 246786.

By submitting this form, you agree to the finder.com.au Privacy and Cookies Policy, Terms of Use, Disclaimer & Privacy Policy and the Aussie privacy policy.

Aussie is both a lender and a mortgage broker, and offers a range of services.

  • FREE Suburb and Property Report with every appointment.
  • Access 3,000+ loans from over 20 lenders.
  • Get expert help with your loan application, including paperwork and eligibility.

Aussie Home Loans Lender Logos

The Adviser’s number 1 placed mortgage broker 5 years running (2013-2017)

Was this content helpful to you? No  Yes

Related Posts

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.
Ask a question
Go to site