Mortgage Refinancing | Will It Benefit You?
Not happy with your current loan arrangements? Maybe it’s time to explore your options, switch banks and refinance your mortgage.
Scroll down to discover if mortgage refinancing is the right choice for you.
What is mortgage refinancing?
Mortgage refinancing is the process of replacing your existing loan from current bank with a new bank under different – but usually better – terms.
Basically, the new mortgage will have a better interest rate, loan term, payment schedule and loan conditions. These factors will be based on your current circumstances.
Why do Kiwis consider mortgage refinancing?
Refinancing your home loan from one bank to another can be tricky. Calculating the costs of refinancing is very important and the thumb rule is that you should refinance only if it is beneficial.
You can refinance your mortgage for one or more reasons:
- To secure better interest rate and cash bank offer.
- To consolidate your high interest bearing debts.
- To borrow funds for renovation, holidays or other plans.
- To move from minoo bank or private lender to mainstream bank.
- To diversify your portfolio in multiple banks.
Should I refinance my mortgage?
- Your existing home loan is due for re-fixing and you don't have to return cashback to your existing bank.
- Your existing home loan is not due for re-fixing but you are paying high-interest rate and since the market has changed, you want to take benefit of lower interest rate, combined with new cashback from the new bank.
We will help you in calculating the cost of refinancing and cost-benefit analysis of this exercise. Typically, following costs are involved in the home loan:
- Fixed loan term breakage costs
- Cash Back return
- Solicitor costs to move your mortgage
- Valuation costs.
- Any other costs depending of the type of property or new new bank's requirements.
The bottom line is this: If the overall benefits outweigh the closing costs, you should definitely get a refinancing loan.
Searching for the best refinance rates, please contact us.
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