How to refinance your home loan

So you've decided you would like to refinance your current home loan. Generally when choosing to refinance you have either found a better deal or you would like more money in your pocket each week, therefore you have decided to draw down on the equity you have in your home loan. Here we look at the process of refinancing your current loan.

For what ever reason you have decided to refinance, you will find that the process is quite straightforward. If you are switching lending institutions then you may find that the lender you are switching too is able to organise all of the paper work for you. They are generally quite obliging as they are getting your business.

The first step in the process is deciding the purpose of the refinance, is it to obtain a better interest rate deal or are you looking to restructure your loan to have more money to spend each week? Once you have decided this you may then be able to employ a mortgage broker to assist in obtaining the best deal (tip: apply online to make the process even easier) or you can contact the lending instituition you are currently with to see if they can offer you a better deal.

Deciding to switch your home loan

Once you have been shown all of the deals available to you all that's left to do is to make a decision as to which lender you are going to go with. If it is your current lender then they will generally be able to arrange a smooth transition from one loan to another, but beware of any switching fees that may be charged in the process. If you are changing lenders, the new lender will more than likely be able to arrange the paper work for you and all you will have to do is sign. Once again be aware of any switching fees that may apply when leaving your current lender. Fees will almost certainly apply if you leave a fixed interest loan early.

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