The old saying says the grass is always greener on the other side. Sometimes with home loans it certainly seems that way. Other banks may have lower interest rates and fees or seem to give better customer service, so it’s no wonder that many people investigate the option of changing banks. However, you need to make sure that your reasons for refinancing are the right ones. Lower costs and better loan products and features are good reasons to consider, but you’ll need to factor in the costs to change banks as very often this can outweigh the potential benefits.
If you use a Pandanus Mortgage Broker, then getting a financial health check is both free and convenient, so take advantage of it to make sure that your current lender is meeting all your financial needs. But don’t be pressured into changing lenders. A good broker will always show you what options you have with your current lender before presenting options from other lenders.
A great reason to consider refinancing your loan would be so that you can pay it off faster. Many loans are structured in a way that benefits the lender and not you, the borrower. By making some changes to your cash flow, you can significantly reduce the number of years it takes to repay your loan and as a result, you can potentially save a significant amount of interest. Have a look at our Debt Reduction section to find out more about this.