The loan you have now might have suited your needs when you first bought your home, and there might have even been different mortgages available then, than there is now. However, times can change, and so can loan requirements. Your current loan may not be the best option for you and your family now. Or maybe you have a number of smaller loans as well as your home loan, and you realise you are paying way too much in repayments. Being able to refinance can mean putting all those loans into one new loan, or taking out a new home loan with a better rate or lower fees. While it may seem easier to keep things where they are now, finding a refinancer could save you thousands of dollars and help you avoid prolonging the life of your loan. Having everything under the one roof, so to speak, can make a big difference. Scheduling a regular mortgage check-up is one way to always ensure you are in the best position you can be. Housing loans can be difficult things to keep on top of, and we want to make sure you are getting the best deal possible. Whether that’s turning to a refinancer, or tweaking your current loan, our experienced advisors can make a big difference.
What new loan options are there?
It is important whether you seek out a refinancer, or whether you keep things the way they are, to be clear about your goals. Perhaps a new loan is the answer. At Mortgage House, we have loans that can suit any situation. Our two most popular loans are our variable rate and fixed rate loans. We also offer split mortgages, which, as the name suggests, can split your loan into variable and fixed rates. No matter what your credit history, we are interested in hearing from you. You might be surprised, and be eligible for a loan even if you thought you weren’t. We have access to loans for people who have had bad credit in the past, as well as low deposit and low doc options. And if you can support your loan application with a pledge from your family, we have a product as well. And, of course, if you are looking for a new loan, we also offer toggle offset loans portable loans, and interest-only loans.
What is the best refinanced loan option?
Being a refinancer, we can unlock the potential of your mortgage loan. However, you may not like the idea of a refinanced loan, especially if your first mortgage loan was a difficult and a bit of a struggle. Going through our choice of mortgage loans to find a refinanced loan will be a similar experience in terms of process, but you are not a first home buyer this time, which is great news. The fact you have been through it all once before can make you better equipped. And we can be there to help this time. As a refinancer of mortgage loans, we know every step of the process intricately. And we use that knowledge and experience to help you take the stress out of finding a refinanced loan.
Where can I find out more about refinancing?
So, why should you consider refinancing now? With interest rates at historically-low levels, the current environment can present you with a great opportunity. The current variable rates can be a lot lower than when you first took out your loan, which can be very attractive. But it’s important to not make refinancing all about the interest rate. Refinancing mortgages should be done with a goal in mind. Consolidating your debt in one loan, or refinancing to buy another property, can result in different f loan recommendations from us. There are no hard and fast rules, but we can help you keep an eye on things, and let you know when the time is right to refinance to achieve your goals. That can mean keeping an eye on your current loans, as well as the economic environment, and even your own family’s needs. There are lots of reasons to refinance, and having us around with access to the same loans as other lenders, means we can make these kinds of moves easier.
Do you know how your home can help?
Your current home can play a big role in refinancing your loan. If you have been paying off your home loan with no major dramas over the years, you have probably built up a lot of what’s called equity. When it comes to refinancing, equity can be solid gold. Equity is the market value of your home, minus the balance of your loan. The more equity you have, the easier it can be to hit your refinancing goals. Lenders will use another equation based around how much you want to borrow, up against the market value of your property, and come up with a percentage. Anything greater than 80% can be labelled as high risk.
What documents to you need to apply?
Whether you’re refinancing to find a better deal, buy more real estate or free up equity in your home for other reasons, you will need to go through the processes of getting another mortgage. When you apply for a loan to refinance, there is not a lot of difference in what you will need to do. A good start is to work out the equity you currently have in your home, which we will detail below. Speak with our mortgage experts about your financial situation, and we will help you find a home loan that will be suitable for your property or financial objectives. If everything goes well, we can give you pre-approval and help you move ahead with your plans. However, you will need to provide us with a few documents, whether you are applying for a loan for 5 years or 30 years.
The first step is to provide us with information about your current property. We will do a valuation and let you know how much it is currently worth. That allows you to assess your equity and value your assets. Let us know the details of your current home loan, if it is not with us. That will give us a chance to look at how your repayments have been going and how much you still have to pay. You will then supply all the usual financial documents you need when you apply for a loan, such as proof of income, employment history, liabilities and any assets you have. You will also need to provide proof of identification. Click on our Documents Checklist for more details.
How much can you borrow?
Finding the loan amount you want when you are refinancing can come down to the equity you have in your existing home. If you are looking to refinance simply to find lower repayments or better loan features, then that process is relatively simple. However, if you are looking to borrow more money, there are a few other things to think about, and equity is the most important one. Basically, equity is the difference between the market value of your home, and the balance of your loan. For example, if your home is valued at $600,000 and your loan balance is $300,000, then you could have up to $300,000 equity in your home. Refinancing means you could start with pre-approval of up to $300,000, although most banks and lenders tend to only let you borrow up to 80% of the market value of real estate.
This equity can be freed up to do a number of things, including investing in more real estate, helping someone else become a home buyer or investing in the stock market. Always remember that stamp duty applies to property purchases. When you apply for a loan, any loan (including refinancing) our borrowing mortgage calculator can help you get an idea of your borrowing power. Simply enter as much information as you can into it, and you will receive an indication of what you might be able to borrow. Speak with us for more details, including any terms and conditions that may not be obvious.
What are the costs of refinancing?
It doesn’t matter whether you have, or are looking to get, a fixed rate or variable rate loan, an interest-only or a principal and interest loan, there can be some costs and fees hidden in the terms and conditions. Firstly, we have a mortgage calculator that can give you an indication of what you might be able to save by refinancing. Our Switching Mortgage Calculator is a great place to start to identify any immediate repayment benefits. You will need to be aware of any ongoing fees and charges over the life of the loan. Take a look at the comparison rate of your new loan to get an indication of them. You may have to pay settlement fees if you repay your loan sooner than expected, and there may also be valuation fees associated with finding out how much equity you have. There can also be legal fees associated with a new loan, and you may have to pay Lenders Mortgage Insurance (LMI) if your new loan tips you over the 80% Loan-to-Value Ratio.
How long can it take to refinance?
At Mortgage House we know how important it is to get results as quickly as possible if you apply for a home loan to refinance. We can give your home loan a health check in as little as 20 minutes. From there, it’s a matter of finding a suitable mortgage, which we can help you with on the spot, and then applying. Contact our expert lenders to begin today.
What options should you consider before refinancing?
The first thing to look at is the health of your current home loan. Look at your current financial position and work out whether it can be helped by refinancing. That can mean smaller repayments, or give you access to a range of features you currently don’t have. It’s important to remember that refinancing means you may be committing to another mortgage, and you may be extending the time you will be paying a home loan off. Paying less now usually means you will pay it for longer. This can mean you pay more interest over the life of the loan, and that can affect your retirement plans and other financial or life objectives. Remember to look at any fees or charges, and weigh them up against any possible savings.