Whether you want to renovate, consolidate debts, secure better / cheaper rate options, raise funds for a purchase, change your rates or loan options, refinancing your existing homeloan may be the way to go.
The mortgage market is ever changing which is why staying in touch with First Choice on a regular basis is the smart thing to do. We are always happy to conduct a review or quick home loan health check on your current loan.
Reasons to refinance
1. Secure a better interest rate
One of the key reasons home owners choose to refinance their loan is to secure a lower interest rate and reduce their monthly repayments. However, refinancing can come with some costs, so it’s essential to weigh up the savings of refinancing against the expense involved.
2. Switch between variable/fixed rates
If you’d prefer the certainty that repayments will stay the same for a period of time, you may wish to switch to a fixed rate. Conversely, you may decide you’d like to take advantage of a lower variable rate as you can accept the risk that rates may rise in future.
3. Access equity in your home
Your home is likely to be one of your most valuable assets, and by harnessing home equity you have the opportunity to build additional wealth or simply achieve personal goals. Find out more about accessing your home’s equity by contacting our team who can quickly ascertain what’s possible for you.
4. Consolidate debt
Refinancing your home loan can provide an opportunity to streamline your debt, and potentially reduce the overall interest you’re paying on multiple debts through the process of ‘debt consolidation’. It means folding several short-term loans into one loan – which could be your home loan – and may reduce your total monthly repayments.
However, it’s important to note that debt consolidation can come with some downsides. It can turn a short-term debt like a personal loan into a long-term debt (your mortgage), and that means paying interest on the balance for a much longer period which could cost you more in the long run. For debt consolidation to be truly cost effective, you need to commit to making additional repayments to pay off the enlarged loan as quickly as possible. All of this can be illustrated to you by one of our expert mortgage advisors.
Please note these guides are not a replacement for professional financial planning advice. Please contact a member of our staff for comprehensive advice on your requirements.