Top 5 Reasons to Consider Refinancing

ByAndrew Mirams

A home loan isn’t just a debt, it’s a great financial tool that you can use to build wealth and facilitate your lifestyle. That’s why few people keep their original home loan for the life of the loan – it pays to keep it up to date to meet your needs as circumstances change.

Refinancing your home loan means replacing it with one that better suits your current needs – and it’s something you may consider for a variety of different reasons. Here are the top four reasons why you might consider refinancing your home loan.

  1. To save money on your home loan repayments

The top reason people come to us to discuss refinancing their home loan is that they may now qualify for a better interest rate. Reducing the interest you pay can lower your repayments and save you a significant amount of money over the life of your loan.

When you first applied for your home loan, your financial situation played a key role in determining the rate you received. As your circumstances improve over time — such as increased income or reduced debt — refinancing could allow you to secure a more competitive rate.

In many cases, switching lenders can also unlock better rates. For instance, while the big four banks recently increased interest rates outside of RBA movements, many smaller lenders kept their rates between 0.20% and 1% lower. If your lender has raised your rates, now might be the perfect time to have us shop around for a better deal.

When considering refinancing, it’s also worth exploring offset home loans. An offset account links directly to your home loan, reducing the amount of interest you pay by offsetting your loan balance with your savings. For example, if you have a $500,000 mortgage and $50,000 in your offset account, you’ll only pay interest on $450,000. Combining refinancing with an offset home loan can maximise savings and help you pay off your mortgage sooner while keeping flexible access to your funds.

  1. To access your equity for property investment

Property investment remains one of the most popular ways to build long-term wealth in Australia. While saving for a deposit to purchase a second property can be challenging, the rapid rise in property values in recent years has created opportunities for homeowners to refinance and access the equity in their current homes to use as a deposit instead.

Your home’s equity is calculated by subtracting what you owe on your mortgage from its current market value. To refinance and release this equity, your lender will need to arrange a valuation to determine your property’s up-to-date worth.

Accessing equity will increase the amount you owe on your existing property, which means higher mortgage repayments. However, if you reinvest this equity into another property, you’ll be positioned to benefit from capital growth across two assets — helping you build wealth over time.

For investors looking to diversify their portfolio, it’s also worth considering asset finance alongside property investment. Asset finance allows you to secure funding for vehicles, equipment, or other business assets without tying up large amounts of capital. This strategy can support your broader financial goals, improve cash flow, and create additional income streams — helping you make the most of both your property equity and overall investment potential.

  1. To renovate or extend your home

Renovating or extending your current home to suit your growing family or evolving lifestyle is often a smarter and more cost-effective choice than purchasing a new property. By upgrading your existing home, you can create a space that perfectly fits your needs — and if you plan your improvements wisely, you may even increase your property’s overall value. While accessing your home’s equity to fund renovations may increase your loan balance, the added value and comfort often make it a worthwhile investment.

Maintaining and enhancing the value of your biggest asset is essential. Even if you’re not planning an extension, keeping your home modern and well-maintained can protect its market value over time. If your property could benefit from a refresh, consider refinancing with a fixed home loan to fund your renovation.

A fixed home loan allows you to lock in an interest rate for a set period, ensuring predictable repayments and financial stability while you manage renovation costs. This approach provides peace of mind, protecting you from rate increases and helping you focus on transforming your home with confidence. If you’re thinking about updating or expanding your space, talk to us about how refinancing with a fixed home loan could make your renovation goals achievable.

  1. To consolidate debts

Your home loan interest rate is probably the lowest form of interest you will need to pay on any loan in Australia. Credit card interest rates can be as much as four times higher than your home loan interest rate and this can make credit card debts difficult to pay off. Other expensive debts like car loans or personal loans can also prove to be a drain on your finances.

If the value of your home has increased over the last couple of years, it may be worth considering accessing some of the equity in your home to pay off your more expensive debts. This could dramatically reduce the amount of interest you have to pay on your overall debts each month, offering you some financial relief and helping you to enjoy a more comfortable lifestyle.

It’s a far better idea to be in a position to save money each month rather than waste it on expensive credit card interest repayments. By refinancing to consolidate your debts, you could possibly find yourself in a position to save money to make other investments or even pay off your home loan sooner. Ask us to help you crunch the numbers to see if using your home loan to consolidate your debts will be a good idea for you.

5. To access funds for various personal or financial goals

Other uses for a lump sum in cash are literally endless – you could use your equity to buy your family a boat, a caravan, the overseas holiday you’ve always wanted or even use it to invest in a business or stocks and shares. However, we encourage you to act responsibly and only access your equity for lifestyle reasons if you can genuinely afford it. That means talking to us to help you discover your real financial position and if accessing your equity is a good idea for you.

Ask us if refinancing is the right move

If you have plans or goals for your future then remember, your home loan can be used as a financial tool to help you reach them. We’re here to help you make the most out of your home loan, so please don’t hesitate to give us a call for a chat about what you want to achieve and how refinancing your home loan could help to get you where you want to be. We’re always happy to spend the time with you to help you make the right decisions to reach your financial goals, so please call us today.

The information provided in this article is general in nature and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Before acting, you should consider the appropriateness of the information with regard to your objectives, financial situation and needs.

Discuss your specific needs & formulate the right strategy for you. Get in touch to organise your complimentary 60min session today!
Andrew Mirams
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