Have you thought about refinancing? By refinancing your home loan and securing a lower interest rate, you could save thousands. However, a recent survey by Compare Club has found that 57% of respondents who have owned a property for more than five years haven’t considered refinancing. So what are the benefits and why should you look at refinancing options now?
Benefits of refinancing
A home loan isn’t something you should ‘set and forget’ when approved for your first home loan. The main benefit of refinancing is paying a lower interest rate on your home loan so that you can save more and reach your financial goals faster. According to Compare Club Home Loans’ General Manager, a homeowner with a $450,000 mortgage and 30 years left on their loan can save approximately $3,600 annually and more than $108,000 overtime if they can refinance and reduce their interest rate by just 0.8 per cent (mortgage business).
Why aren’t more people refinancing?
Survey results reveal that the main reason for not refinancing is perceived complexity. Some respondents were also worried about moving from a fixed interest rate, exit fees, satisfaction with their current loan and ease of all of their financial products being in the same place.
You may be satisfied with your current home loan, but you could make a significant return in the long run by doing the research now. After looking at the market, you may realise that it isn’t the right time for you to refinance, but it is something that you should consider at different stages throughout your loan term.
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If you don’t have the time to do the research, you can always seek advice from a Mortgage Broker. Working with an industry professional will save you time and energy and give you confidence that you’re making the smartest decisions for your financial future.