Refinancing eGuide

Refinancing Guide

eBook

Start your
refinancing

journey
with us

Welcome to Bernie Lewis
Home Loans Refinancing Guide

Refinancing basically means having your existing home
loan repaid out and replaced by a new loan, generally from
a different lender. There are several reasons why you may
consider refinancing, these include:

• There are lower interest rates available; Lower interest rates in the current
• Reducing the term of your loan; market
• Needing greater loan flexibility;
• Using equity to finance large purchases The home loan market is highly competitive
and interest rates can vary significantly
or top up to undertake renovations; between lenders.
• Consolidating Debt; or Interest rates have also fluctuated over time
• Your circumstances may have changed and whilst your current interest rate may
Let’s take a look at these in more detail. have been competitive at the time you took
out your loan initially, there may be a better
rate and product available now that is more
appropriate to your circumstances today.
Refinancing to a lower interest rate (not
necessarily with a different lender) could save
you a lot of money that is potentially being
wasted.

Shorten the term of your loan

Should you refinance to a lower interest rate
but continue to pay the same repayments you
have previously you will:
• reduce the amount of interest paid saving

you thousands of dollars
• reduce the term of your loan, potentially

by quite a few years.
Of course this depends on the extra amount
you pay above the minimum repayments
required.

Needing greater loan flexibility

Depending on what you need from your Consolidating debt
home loan, it may be that your current loan
doesn’t have the flexibility you need such You may currently have multiple credit cards,
as redraw facilities, split loan options, offset store cards and a personal loan, as well as
accounts etc. This might mean that you need your home loan.
to switch home loans so you have a product Providing there is enough equity in your
that better suits your needs and provides this home, combining these debts or at least
flexibility. Whilst this sounds painful, it does some of them into one single repayment
not necessarily mean you have to change (your home loan) at a low interest rate, can
lenders as your current lender may have the save you a lot of money in not only interest,
product/s you’re after. but your repayments as well. It can both
A Bernie Lewis Mortgage Adviser has access simplify your finances and potentially free up
to most Lenders products and can discuss some cash to do the extra things you need.
these options with them on your behalf.

Using equity to finance large
purchases or to undertake renovations

Equity in home loan terms is the difference Your circumstances may have changed
between the value of your home and the
amount of your loan outstanding eg; Since you first obtained your current loan
your circumstances may have changed. For
Home Value example income, relationship, or even the
$400,000 number of dependents you now have in your
Loan Balance Outstanding household. We recommend you review your
$260,000 home loan regularly in conjunction with those
changes, and talk to your mortgage adviser
Equity about whether your current home loan still
$140,000 meets your needs.

Depending on how long you’ve had your
current home loan and how much you have
paid off it, there may be enough equity to tap
into to purchase larger items such as a motor
vehicle, a swimming pool, or to renovate your
current home. You may also use this equity as
a deposit to purchase an investment property.

Using your equity can be a cost effective way
to finance larger purchases when you are
capitalizing on the current low home loan
interest rates.

In summary there are many reasons for tapping into the benefits of
refinancing your loan and it doesn’t necessarily mean you have to switch
lenders either. At Bernie Lewis Home Loans our mortgage advisers will
work with you to determine how your loan and structure can best meet
your needs, and can then negotiate with your Lender on your behalf to see
if there is a better rate or product available that meets those needs.
A Bernie Lewis Mortgage Adviser can look at your individual situation
and help you determine whether refinancing your existing loan is right
for you.

Questions?
Call us (08) 8300 8300
visit bernielewis.com.au

The information provided in this eBook is general in nature and does not take into account
your personal circumstances. Since everyone’s personal situation is different, this article
should not be taken as advice and you should speak with a mortgage adviser or your
accountant to determine which solution is right for you.

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