Executives face unique refinancing challenges. This guide walks you through the options, costs, and strategies so you can make informed decisions about your mortgage.
What is Refinancing?
Refinancing means replacing your existing mortgage with a new loan, typically at a better rate. When you refinance, you settle your current mortgage and take out a new one with different terms — usually a lower interest rate, different loan term, or both. The new loan is used to pay out the old one, and from settlement onwards, you make payments on the new mortgage instead.
Why Refinance? The Main Reasons
Borrowers refinance for three main reasons: to access better interest rates (rate refinance), to access home equity for investment or other goals (cash-out refinance), or to consolidate debts into a lower-rate mortgage (debt consolidation). Each has different benefits and costs.
The Refinancing Timeline: What to Expect
A typical refinance takes 3-5 weeks from application to settlement. Pre-approval usually happens within 1-2 days, full approval within 1-2 weeks, and settlement within 2-4 weeks depending on valuation and legal processes. Specialist lenders can often move faster than major banks.
Refinancing Costs: Valuation, Legal, Application
Expect to pay: valuation ($300-500), legal fees ($500-800), application fee ($0-300), discharge fee ($100-200), and registration ($50-100). Total refinancing costs usually range from $950-1900. Some lenders may waive application fees as a competitive gesture.
Should You Refinance? The Break-Even Calculation
Refinance makes sense when the rate saving over your planned loan period exceeds the upfront costs. For example, a 0.5% rate saving on $500k saves $2,500/year — covering $1,500 in refinance costs in about 7 months. If you plan to stay in the property for 2+ years, refinancing is typically worthwhile.
Fixed vs Variable When Refinancing
When refinancing, you choose between fixed and variable rates. Fixed rates lock in certainty but cost 0.25-0.5% more. Variable rates can drop if the RBA cuts rates, but expose you to rate rises. Current market conditions and your risk tolerance should guide this choice.
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Get Free Assessment →Frequently Asked Questions
Pre-approval: 1-2 days. Full approval: 1-2 weeks. Settlement: 2-4 weeks. Total: 3-5 weeks usually.
Yes — most lenders allow refinancing at any time. Some may charge a break fee if you refinance from a fixed-rate product early.
Short-term yes (hard inquiry, new loan). Long-term no — on-time repayment improves your score over 3-6 months.
Yes — refinance each property separately with the same or different lenders.
You can still refinance if you have equity (typically 20%+ LVR). The new loan is limited to 80-90% of current value.
Should You Switch? Get a Free Checkup
Not sure if refinancing or switching is right for you? Let us review your situation and run the numbers. You might be surprised how much you could save.
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