Buying a home is one of the most significant financial decisions you’ll make in your lifetime. However, when it comes to securing a mortgage, finding the right interest rate can be just as important as finding the right property.
That’s because the interest rate you get charged can have a significant impact on the size of your mortgage repayments.
Home loan interest rates can vary depending on several factors, including market conditions, lender policies, and your own financial situation. So, if you’ve had your home loan for a while, there’s always a chance you could find a more competitive deal.
Switching your mortgage deal to a new one offering a lower rate could help you save thousands of dollars in interest payments over the life of your loan. But you might be wondering how to find the best rates for refinancing your home loan.
Here are four tips to get you started.
1. Do your research
The first step in finding the best rates for refinancing your home loan is to shop around and compare different lenders and loan products.
Keep in mind that when comparing interest rates, it is crucial to look beyond the headline rate. Some lenders may offer a low-interest rate but have higher fees or charges, which can ultimately make the loan more expensive than it initially appears.
2. Use a home loan refinance calculator
A home loan refinance calculator can help you estimate how much you can save by refinancing your home loan. You can use this calculator to compare your current loan with potential new loans and see the estimated interest savings and the new loan repayment amounts.
3. Consider the home loan refinance costs
Refinancing your home loan may come with costs such as application fees, valuation fees, and discharge fees. You should consider these costs before refinancing to make sure the overall savings outweigh the refinance costs.
Depending on the lender and loan product, these costs can quickly add up so it’s important to factor them into your calculations when comparing different options.
Some lenders also cashback or other financial incentives to switch to their loan product, so be sure to weigh up these offers against any fees or costs involved.
4. Get professional help
By working with a mortgage broker, you can save time and effort when looking for the best refinance home loans. That’s because a mortgage broker gives you access to a range of different lenders, including major banks, credit unions, and non-bank lenders. They will then help you navigate the different loan options, offering expert advice on which products may be best for your individual circumstances.
