Wavelength - brought to you by bcu

Did you know it’s recommended everyone do a health check on their home loan every 12 months?

Reviewing your home loan and seeing what options are available to you will not only help to keep you on top of your finances, it could potentially save you thousands over the life of your loan. While many people look to refinance for a better interest rate, refinancing can also be a great option if you want to consolidate debt or access equity for renovations or to buy a new car.

We’ve put together a step-by-step guide to help you decide whether refinancing is the right choice for you and find the home loan that meets your needs.

Step 1. Review your home loan

Do you know the current interest rate on your home loan, the fees you pay or what your repayments are?

One of the best things you can do is reassess your current home loan and compare with other products on the market to see if it’s worth refinancing.  A small rate reduction or lower or no fees could make a big difference in the long run, so taking time to review your loan and find a better deal will be worth it.

Step 2. Compare home loan options

Once you’ve established your current home loan costs and the interest rate you’re being charged, it’s time to compare this against other loans. By checking out the competition you will get a good idea of where you sit in the market and whether there’s an opportunity for you to save over the life of your loan by refinancing.

There’s a range of options to consider, such as variable rate loans, fixed rate loans and even split loan options. You will also need to decide whether you want a product with all the bells and whistles or a no-frills home loan. Do you want an offset account, the ability to make extra repayments, a credit card or redraw facility? Only choose the things you need, as you don’t want to be paying for extras you won’t use.

Check out our home loans and compare to see if there’s a product that’s right for you.

Step 3: Take a closer look at the fees and charges

It’s important to consider any costs associated with exiting your current home loan and switching to a new loan. Costs such as the settlement, loan establishment, exit and mortgage registration fees and charges can add up and you’ll want to know you’ll be achieving long-term savings if you do decide to switch.

Find out whether you’ll have flexibility of repayments, if you will need Lenders’ Mortgage Insurance (LMI), how long you’ll need the loan for and whether you’re protected against sudden rate rises.

Step 4. It’s time to switch

Once you’ve made the decision refinancing is the right option for you, it’s time to make the switch by contacting your preferred lender.

If you choose to go with bcu, we can walk you through the details of your home loan selections to make sure you fully understand the potential benefits of each loan and any costs.

Once your application is approved, we’ll pay off your previous home loan and your new one will begin. A little tip. While it might be tempting to reduce your repayments after you refinance, try to keep your repayments at the same level so you can pay off the loan sooner.

Looking to refinance your loan?

We’re here to answer all your questions. Enquire online, give us a call or drop into your nearest bcu branch.

Important information

Information on this website is general and has been prepared without taking into account your objectives, financial situation or needs. You should consider whether this information is suitable for your objectives, financial situation and needs before acting on the information provided.