Everything You Need To Know About Refinance Home Loan

Everything You Need To Know About Refinance Home Loan

By: Nfinity Financials0 comments

Are you thinking about refinancing your home loan? Maybe you want to pay it off faster, get a better interest rate, or use some of the money you’ve paid off. Refinance your home

Refinance home loan can be a smart money move, but it can also be tricky. This blog will help you understand everything you need to do for a successful refinancing. We’ll cover everything from understanding home loan refinance fees to how to calculate refinance for home loans.

Documents You Need For Refinancing

Before you start refinancing, you need to gather some important papers. Here’s a checklist of what you’ll probably need:

1. Personal Information:

  • Proof of identification (e.g., driver’s license, passport, birth certificate, Medicare card).
  • Date of birth, current address, and contact details.
  • Details regarding your family situation (e.g., relationship status, number of dependents).

2. Proof of Income and Employment:

  • Recent payslips.
  • Group Certificate.
  • Latest Tax Assessment Notice.
  • Letter from your employer confirming salary.
  • Business details for self-employed individuals (e.g. two years of business and personal tax returns, (Australian Taxation Office assessments).

3. List of Existing Loans, Expenses, and Liabilities:

  • Last six months’ documentation of existing home loans and debts.
  • Most recent credit card statements.
  • Copies of bills and bank statements.

4. Current Assets:

  • List of assets such as cash, savings, shares, vehicles, jewelry, art, and cryptocurrency.
  • Supporting documents demonstrating the value of assets.
  • Refinance Eligibility Requirements
  • Meeting the eligibility criteria is crucial for a successful refinancing application. While requirements may vary among lenders, the typical criteria include:
  • Australian residency or permanent residency.
  • Minimum of 20% equity in your home to avoid Lenders Mortgage Insurance.
  • Good or excellent credit score and history.
  • Employment status with proof of income.
  • Age requirement of over 18 years.

Benefits of Refinance Mortgage

Refinancing offers several benefits that can significantly impact your financial situation:

  • Lower Monthly Payments: Access to cheaper interest rates can lead to substantial savings on monthly repayments.
  • Shorten Loan Term: Pay off your loan faster, thereby maximizing available equity and owning your home outright sooner.
  • Access Equity: Refinancing may allow you to tap into your home’s equity for various purposes, such as investments or renovations.
  • Fixed Interest Rate: Switch from an adjustable-rate mortgage to a fixed-rate mortgage for stability and potential savings.
  • Debt Consolidation: Combine high-interest debts into your home loan, potentially reducing overall interest costs.
  • Better Loan Features: Request additional features like redraw facilities or offset sub-accounts to optimize your payments.

Understanding Home Loan Refinancing Fees

When considering a refinance mortgage, it’s essential to understand the various fees involved to make an informed decision. Closing Costs encompass a range of fees, including application fees, appraisal fees, title search fees, and attorney fees. Additionally, you may encounter Lenders Mortgage Insurance (LMI), particularly if your equity is less than 20%. Break Costs may apply if you’re breaking a fixed-rate loan prematurely. Discharge Fees are charged by the existing lender for closing out the current loan, while Government Charges like stamp duty or mortgage registration fees may also factor in.

Mortgage Refinance Calculator

Before deciding on refinancing, it’s important to figure out the potential costs and savings. Start by comparing Interest Rates to see how much you could save on monthly payments. Adjusting the Loan Term can also change payments and the total interest paid. Calculate your available Equity to figure out your refinancing options. Then, do a Cost-Benefit Analysis to compare potential savings with refinancing costs, including additional fees like closing costs and LMI. You might want to get advice from a professional about the cost of refinancing a home loan.

Ready to Refinance?

Now that you have all your documents and know where you stand financially, it’s time to start refinancing. Talk to experts who can give you advice tailored to your situation, and make sure you look into all your options carefully.

Refinancing your home loan can change your financial situation for the better. Moreover, it can help you save money, get access to some extra cash, and reach your goals as a homeowner faster. By using this guide and getting help when you need it, you can go through the process smoothly and make your financial future brighter.

So why wait? Book a Consultation call at 1300 GET LOAN with Nfinity Financials today. You can also check out our Articles on Refinancing here

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