Refinancing your mortgage might help you lower your interest rate, shorten your loan term, or turn equity into funds you need – but it comes with a cost. Closing costs, like your first mortgage, must be considered.
Why should you refinance your mortgage?
- You can lower your monthly payment:- If you have a fixed-rate mortgage with a higher interest rate than the market, refinancing could help you save money on your monthly mortgage payment.
- You can reduce the length of your loan:- You can refinance your 30-year mortgage to a 15-year loan to pay it off faster and at a lower total interest rate.
- You can convert an adjustable-rate loan to a fixed-rate loan:- If you have an adjustable-rate mortgage, you may want to consider switching to a fixed-rate mortgage.
- You can avoid paying for private mortgage insurance (PMI):- If the value of your property has increased and you now have 20% equity, refinancing is one option for removing PMI.
- You can acquire money to help you achieve your goals:-If you have enough equity in your house and want to pay off credit card debt or make home upgrades, you can perform a cash-out refinance.
To participate in or bid at an auction, prospective buyers must first register with the vendor’s agent and be assigned a bidder number. The auctioneer is in charge of the bidding process. They accept bids from prospective buyers and monitor the current offer price.
Before an auction, the seller will set a reserve price, which is normally not published. If bidding exceeds the reserve price, the property is sold upon the drop of the hammer. If your bid is successful, you must sign the contract of sale and pay the deposit right away (usually around 10 percent of the purchase price).
If you bid at an auction, you must be prepared to exchange contracts and execute the transaction. Otherwise, you will forfeit your deposit and may be held accountable for the vendor’s damages.
What fees must I pay while refinancing?
The following are some common refinance charges to inquire about:
- Discharge fees fee paid to your present lender to pay off the previous loan in full and prepare the necessary papers.
- Fees for applications:- The cost of submitting a new loan application.
- Valuation fees:- A fee levied by the new institution to cover the cost of obtaining an up-to-date appraisal on the property being used as security.
- Fees for land registration:-These are the fees for transferring your existing mortgage from your current lender to your new lender.
- Lenders Mortgage Insurance (LMI):- If you have less than 20% equity in your home, your new lender may charge you lenders mortgage insurance (LMI).
FAQs
Got questions? Find answers to some of the most commonly asked questions about our financial solutions, processes, and services to help you make informed decisions.
LMI is a third-party insurance premium payable by you as the borrower, to protect the lender against the potential loss of money if the borrower is unable to repay the home loan. Generally, an application with a Loan-to-Value Ratio (LVR) of 80% or more may result in the borrower having to pay Lender’s Mortgage Insurance.
Extra payment is an excellent feature of a good mortgage deal. Here, your lender lets you make lump-sum additional payments along with your regular monthly payment. Making extra payments allows you to shorten the length of time you are paying your mortgage. Since your balance is being paid off faster, you will also have fewer total payments to make, thus lowering your interest. At Reliiance Financial Solutions, we can help you find the most suitable mortgage deal for you. We have a range of lenders that allow you to make as many extra repayments as you want, whenever you want, without attracting any penalties.
Stamp Duty is a government tax imposed on contracts, with the amount usually calculated as a percentage of the contract value. In layman’s terms, it is the tax charged for your legal documents to be ‘stamped’.
If you are planning to buy a property, it’s crucial to factor your State’s Stamp Duty into your budget.Chances are, based on your circumstances and state of domicile, you might be able to obtain a stamp duty exemption, or concessions (discount) against the purchase of your first home. Stamp duty laws get changed often, so be sure to check your State Government’s website for the most up-to-date information.
Did you know that some lenders would allow you to cash out any extra repayment you made whenever you need the money? You read that right. This useful mortgage feature is called “redraw facility”. You can withdraw any extra repayments or lump sum payments you make over the life of the loan. At Reliiance Financial Solutions, we will explain all mortgage products to you, including those which allow you to the redraw option.
Testimonials
Discover how we’ve helped our clients navigate their financial journeys with personalized solutions. Read their stories of success and empowerment below.
A 5-STAR RATED FINANCIAL SOLUTIONS PROVIDER BY OUR CLIENTS
At Reliiance Financial Solutions, we have been privileged to have worked with hundreds of remarkable individuals and families.
Very few things come close to receiving their genuine appreciation of our services. All we can say in return is – the pleasure was all ours.
It is also our pleasure to share some client testimonials with you. Please click on Video Testimonials to view them all. Use the buttons at the bottom of the screen to navigate through the videos.
