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The costs of refinancing a home loan


The cost of refinancing your home loan

If you’re worried about potential costs to refinance, you’ll be happy to hear we don’t charge any bank fees! Even better, you could save money in the process.

Whether you’re searching for a better interest rate or looking to free up some cash, there’s a bunch of reasons you might decide to refinance. It’s a good idea to do a regular check on your home loan to meet your changing needs.

And, with as many as 82% of Aussies revealing they don’t know what their current interest rate is, there’s never been a better time to find out what you could be saving.

But how much does it cost?

The cost to refinance with UBank versus another institution could look like this:

  Cost   UBank  Other *
  Mortgage discharge fees   $0   $150 - $500
  Application fees   $0   $0 - $1,000
  Valuation fees   $0   $0 - $300
  Settlement fees   $0   $100 - $200
  Annual fees   $0   $750 (ongoing each year!)
  Mortgage registration   $110 - $192   $110 - $192
  Total   $110 - $192   Up to $2,942

The numbers speak for themselves. We don’t charge you a thing except for government registration fees (which we have to charge for!).

Make sure the benefits > costs

Like any big financial decision, it’s a matter of weighing up the benefits against the costs and taking your own circumstances into account.

Some of the things you’ll need to consider:

  • Your current interest rate and repayments
  • If you’re paying any monthly fees
  • If your loan type, fixed or variable, works for you
  • If your repayment type – principal and interest or interest only, meets your requirements
  • Any other loan features that are important to you
  • Whether your current lender will charge you for leaving them

While each home loan will have its own terms and conditions, there are some common terms and refinance costs to get familiar with when shopping around.

Our top tip is to compare comparison rates, as this is the true cost of the loan. The comparison rate combines the interest rate on your loan, plus the fees and charges you can expect to pay across the lifetime of your loan. This single number can be compared to other lenders to work out how much the loan will really cost you.

We keep things simple at UBank. That’s why the comparison rate on our variable home loans is exactly the same as our interest rate. Our fixed rate loans do have a different comparison rate, but this just reflects the one-off fee that applies to fix your rate.

Pro tip: To see how much you could save with a lower rate, check out our handy comparison calculators.

Because we’re committed to simple, you could breathe easier knowing we don’t charge any application, monthly or annual fees on our home loans. In fact, the only fee we charge is the rate lock fee on our fixed rate UHomeLoans we mentioned.

Show me the features!

In addition to our award-winning home loans** and competitive rates, we also offer unlimited redraws on our variable home loans and the freedom to manage your home loan online.

You’ll also get access to Tracker, our handy online application tool that takes the pain out of the home loan process – from uploading your documents, right through to settlement!

Ready set go!

Ready to take the next step with us? Use our handy refinance checklist to make sure you’ve ticked all the boxes before uploading your documents, and also check out the 5 mistakes to avoid when refinancing. You can thank us later!

Refinancing is an important decision and weighing up the pros and cons may take a little time. But we think zero application, annual or ongoing fees and competitive rates are a great place to start.

* Figures obtained from industry sources Canstar and iSelect.

** Winner of 2 Mozo Expert Choice Awards 2019 for both variable and fixed rate discount offers.

The information contained in this article is of a general nature only. It doesn’t take account of any person’s objectives, financial situation or needs. Before acting on this information, you should consider whether it is appropriate for your circumstances and seek independent legal, financial, and taxation advice.