A home loan is generally a long-term proposition, but in some situations it can make sense to refinance your mortgage. Refinancing involves taking out a new mortgage and using those funds to pay off your existing mortgage. Doing so can save money and result in significant financial gains over time.
Here are some things for you to consider if you’re thinking about refinancing.
You might want a lower interest rate.
The lending products market is highly competitive and interest rates can vary significantly between banks. One of the most common reasons people choose to refinance their mortgage is to secure a lower interest rate from another lender. This could assist you to pay off your home loan sooner, potentially saving you thousands of dollars
That makes sense, but before taking any action it’s a good idea to speak with your SB Lending Finance Specialist. They can not only look for a better interest rate for you but also help find you the type of lending facility that suits your lifestyle. This may even mean renegotiating a better deal with your existing lender. Either way SB Lending will help with the right advice.
Keep in mind that not all mortgage products are the same. A mortgage with a lower interest rate may not have all the benefits of your existing loan.
The interest rates, fees and the features need to be carefully considered and your SB Lending Finance Specialist can help you to navigate the options.
You want to change your loan type.
You may want to switch from a variable loan to a fixed loan with your existing lender, to lock in a low interest rate. Depending on the type of mortgage you have, this may require refinancing into a
different product. You might also have to refinance if you want to change to a split loan, which has part variable and part fixed rates.
You want to renovate or purchase an investment property.
Another reason refinancing might be an option is because you want to renovate your home or buy an investment property. If you have equity in your home, you may be able to access some of the equity by refinancing your mortgage. Your SB Lending Finance Specialist can help advise you on the best option for you. Before going ahead with an increase or refinance, your home may need to be revalued and your SB Lending Finance Specialist will advise how much you can borrow.
Your circumstances have changed.
Refinancing could also be suitable if your circumstances have changed – for example, a significant change in your income. By taking out a new mortgage or increasing your limit on the existing mortgage you may be able to consolidate other debts, including personal loans and credit cards, into one facility, lowering your monthly payments and saving you interest.
Achieve the great Australian Dream.
For most Australians, owning your own home, free and clear of any loans, is the ultimate dream. Speaking with and SB Lending Finance Specialist today may help you to tailor a finance strategy to help you achieve this dream sooner. Home Loan rates, fees and charges are only part of the process. Having the right bank accounts, budget and plan in place are also vital to achieving your financial goals.
The refinancing process.
Getting the refinancing ball rolling is simple once you’ve determined your needs.
Your SB Lending Finance Specialist will evaluate your circumstances and assist you in submitting your application. You’ll be asked to provide identification documentation and proof of income such as pay slips, and to list your assets and liabilities.
Lenders will often require a valuation on your existing home to determine how much you can borrow. This bank valuation happens during the loan approval process and generally requires an inspection of the property by a licensed valuer.
Once the lender is completely satisfied, full loan approval is granted. You’ll receive an approval letter with a copy of the loan contract to review, sign and return to the lender.
Your funds will be cleared once all the signed documentation is reviewed. Your lender will arrange settlement of your existing loan and establishment of your new loan.
There are many reasons why you may want to refinance your mortgage. Before taking any action it’s important to talk with your SB Lending Finance Specialist. SB Lending can help you to select the best loan product for your needs, based on your individual circumstances.