18 August 2016 How you could save by refinancing your home loan What is refinancing? Refinancing is when you pay off your existing home loan by replacing it with a new home loan with a different home loan provider, often with a lower interest rate. The new home loan may also consolidate all your other debts into the one loan. Should you consider refinancing? You may be in a better position compared to when you first took out your home loan. Has the value of your home increased? Has your income increased? Have you paid off some of your loan? Or are you simply unsure if you’re on the best deal? At the end of the day, we all want to find ways to pay off our home loan faster. How could refinancing help you? A lower interest rate or reduced fees could help you pay off your home loan faster or give you some extra spending money. Consolidating all debts into the one loan could make your repayments easier to manage. Upgrading your home loan could give you access to features that better suit your current circumstances, such as being able to make extra repayments or redraws. Borrowing additional funds could help you renovate your home, invest in property, or fund a major purchase. What to be aware of Refinancing often involves discharge costs and break costs that are payable when you discharge (your lender will be able to work out the total cost of discharging). These costs however, could be offset by the savings made as part of your refinanced loan. Refinancing also involves establishment costs such as Lender’s Mortgage Insurance. Each situation is different depending on your circumstances and the loan or loans you have. Speaking to lending expert can ensure you understand all the costs involved as well as the benefits you could achieve through a refinance. Consolidating your short term debt into your home loan may extend the loan term of the short term debt and could result in more interest payments over the loan term. You should obtain independent professional advice relevant to your financial circumstances. Speak with Graeme Plenderleith about your home loan options RAMS Home Loan Centre Melbourne Inner South is owned and operated by Melbourne South Financial Services Pty Ltd ABN 53 134 807 245. Credit Provider: Westpac Banking Corporation, ABN 33 007 457 141. AFSL and Australian credit licence 233714.