Is there a ‘best refinance home loan’?

Unfortunately, there is no such thing as a ‘best refinance home loan’ rate or offer. Finding a suitable home loan for you depends on a range of factors. Keep reading to learn more about finding a good deal!

*iSelect is the trading name of iSelect Mortgages Pty Ltd (ABN 86 148 217 181). iSelect Mortgages Pty Ltd is a credit representative (Credit Representative 400540) of Auscred Services Pty Ltd (Australian Credit Licence 442372). iSelect provides a referral to Lendi Pty Ltd, a Credit Representative of Lendi Group Finance Pty Ltd (Australian Credit License 442372). iSelect Mortgages Pty Ltd receives a commission from the Licensee for each new customer account created and for each home loan submitted through this service.

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We partnered with Lendi* to help you compare home loans from over 25 lenders and over 2,500 home loan products.

If there isn’t a ‘best’ refinance home loan, can I still find a better offer?

Absolutely! As mentioned earlier, there is no ‘best refinance home loan’, because what makes a home loan suitable for you can depend on a range of factors. This includes factors such as the comparison rate, loan term, fee structure, additional features, as well as your own circumstances.

Through the process of comparing home loans, you might find a product that has more attractive terms or features than your current loan. Then after some further due diligence to ensure the new product is in fact a better deal, you can begin the process of refinancing.

Where can I find and compare refinancing deals?

Comparing refinance offers and rates by yourself can be an overwhelming and time-consuming task, especially given the number of lenders in the market, and the complexity of home loan products. That’s why iSelect has partnered with Lendi to make the process of refinancing easier.* Lendi can help you compare home loans from their range of lenders, and refinance to a loan that suits you.

How do I find a good deal when refinancing?

There are a range of features worth considering when comparing home loans products with the goal of refinancing. Here’s a few to get you started:

  • Comparison rate: This combines the interest rate with associated fees to give you an idea of the loan’s full cost. This is a great place to start when comparing loans.
  • Fees: These can include fees with your old lender (break/exit fees, as well as discharge fees), and fees with your new lender (application/establishment fees, and valuation fees)
  • Any cashback offers: Lenders can offer a rebate or cash back incentive to attract new refinance customers. It’s important to weigh the cash offer against the interest rate and other fees to ensure it’s still a good deal compared to your current loan.
  • Introductory/honeymoon rate: This is typically a reduced interest rate on the lender’s standard interest rate offered to attract new customers. However, this is usually only for a fixed period, and then the full interest rate will be applied to your repayments. It’s important to ensure the standard interest rate which comes into effect after the honeymoon period isn’t going to be higher than the rate you’re currently on.
  • Loan term: This is important as the loan term impacts the length of time you have to repay the loan, and a longer term could mean paying more in interest over the life of the loan.
  • Loan features: Loan features such as redraw facilities and offset accounts can provide you with added flexibility, as well as potentially lowering you interest repayments, so it’s important to ensure you’re not foregoing any features you like when switching to a new product.

How do I know if refinancing is a good idea for me?

Whether or not refinancing is a good idea for you can depend on a range of factors, including what your financial goals are. Consider the below questions when weighing up if refinancing is a good option for you:

  • Are you looking to lower your monthly repayments?
  • Are you looking for lower fees?
  • Are you looking to compare rates before your fixed interest term ends?
  • Are you looking for a shorter loan term?
  • Are you looking for more features and flexibility (i.e. offset account or redraw facility)?
  • Are you looking to consolidate debt?
  • Are you looking to unlock some equity?
  • Are you looking to borrow more money, say for a renovation or new car?

If you answered yes to some of the above, then it could be worth comparing home loans with iSelect and Lendi*, and assessing your refinance options from their range of lenders.

How many times can I refinance my home loan?

There are no rules on how many times you can refinance your loan, however refinancing can come with costs, and it’s important to weigh these up before making a decision.

  • Fees: These fees can include break fees with your previous lender, as well as establishment/application fees, and possibly valuation fees, with your new lender.
  • Lender’s Mortage Insurance (LMI): If you have less than 20% equity in your home, you may have to pay Lender’s Mortgage Insurance (LMI) again with your new lender.
  • Credit Rating: Refinancing is considered a credit application (similar to applying for a credit card or personal loan) and if your credit history isn’t in great shape, then a failed refinancing application could further impair your credit rating.

Is refinancing worth it?

Refinancing to a home loan with a more competitive interest rate, fee structure, and loan term could lead to significant savings over the life of your loan. Whether or not it’s worth it for you could depend on your financial situation, and whether or not you’re able to find a more competitive home loan offer in the market.

Ready to compare refinance home loans and see if you can find a better deal?

At iSelect we’ve partnered with Lendi to make the refinancing process simple and straightforward.* Get started comparing home loans from 35+ lenders online the easy way, or give Lendi a call on 1300 186 260 (08:30-18:30).

Last updated: 6/12/2021