Why should you refinance a home loan?

So why should you consider refinancing?

The most common reason people look to re-finance is tosecure a lower interest rate. Sometimes, staying loyal to your bank is notactually in your favour. Even a small reduction can make a big difference toyour budget, potentially saving you thousands in interest by reducing your repayments.

Access better features

 Newer loan products often come with added features likeoffset accounts, redraw facilities or more flexible repayment options. Refinancing can give you a chance to align your loan with your future financial goals.

Consolidate debt

If you’re juggling debt month to month. Paying interest across multiple loans or credit cards perhaps rolling these debts into your mortgage at a lower interest rate is the answer. This simplifies your finances and can reduce your overall repayments. Though it is important to manage debt carefully, this option could save you some cash in the meantime.

Unlock equity

As property value rise, many homeowners build equity intheir property. Refinancing allows you to access that equity for other things. Maybe its renovations, investments or other big expenses, without selling your home.

Adjust your loan structure

You might want to switch from a variable to a fixed rate (orvice versa), change lenders, or restructure your repayments to suit yourcurrent lifestyle. Refinancing can give you that flexibility.

Final thoughts

Refinancing isn’t right for everyone and it’s important tofactor in exit fees, new loan costs and long-term impact. But with the right advice it can be a powerful tool to help you achieve your financial goals.

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