• Take advantage of refinancing your mortgage

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    Author: Bankwest (sponsored content)

    Life is always changing. Since you bought your home, your family structure or lifestyle may have changed or your financial situation may be different. There might be another home loan that’s more suited to your life now – and offers you a better deal.

    If you compare home loans and find one that’s better suited to you, you may want to consider refinancing. This means moving your loan from one lender to another.

    Reasons to refinance

    Perhaps you want a better interest rate, more flexible features, to consolidate your debt, or to use the equity in your home to renovate or invest. Here are some of the reasons to refinance in more detail.

    Lower interest rates

    A better interest rate could not only save you money but also help you pay off your home loan sooner. With a lower interest rate, your repayments might be lower every month which means more money in your pocket. Or, if you use some of that saved money to continue making larger repayments you might pay your mortgage off faster and save on total interest paid.

    You hear a lot about interest rates, but every lender uses many different measures to set their rates. That’s why it’s important to speak to a Home Finance Manager or Broker to understand what rates you can access.

    Work out what your mortgage repayments could be

    A loan to suit your needs

    There’s more to a home loan than just its interest rate. If it’s been a while since you bought your house, there might be new features that you didn’t know about.

    You might want to link various offset transaction accounts to your loan or split your loan between variable and fixed rates with no transfer fees. Some home loans also provide you with a rewards credit card or allow you to redraw without fees.

    Going fixed term

    You could be coming to the end of a fixed rate term and want to see if you can get a better interest rate or a more flexible home loan once your fixed term ends. Fixed rates can work really well in the right situation but often when your fixed rate term ends, you’re rolled over to a higher variable rate by default.

    If you wait until after your fixed term to refinance, you may avoid paying a ‘break cost’ fee associated with leaving a fixed rate home loan, which makes it a prime time to look around at what home loan offers are available.

    Paying off your other debts

    You could be trying to simplify your finances and save money by consolidating debts like your personal loan, car loan or credit card into your mortgage. Every lender has different rules about combining multiple debts into one consolidated loan, but debt consolidation is a handy feature of many home loans and might be a reason that you consider refinancing.

    Renovating

    If you’re thinking of renovating, you might already have extra value in your property to use. If your property has increased in value or you didn’t use all the available value when you first borrowed, you might be able to unlock this to renovate.

    Investing

    If you’re refinancing to access the equity in your home, you could use those funds to invest in property, shares, or other opportunities.

    Disclaimer: Bankwest, a division of Commonwealth Bank of Australia ABN 48 123 123 124 AFSL/Australian credit licence 234945