Should you refinance your home loan?

Doing regular health checks on your home loan is a great way to make sure it's still working for you. If your circumstances change or you want a better deal, you could consider refinancing.

But remember, just like with your first mortgage, when it comes to refinancing, there is no magic solution. It's a matter of finding a loan that meets your current and future needs – both personally and financially.

The main reason why you might choose to refinance your home loan is because your circumstances have changed. Maybe you've received a pay rise and are able to make larger repayments and pay off your home loan sooner, but your current loan doesn't allow for something like this.

If your financial situation is different from when you locked in your home loan, you might be able to find new loans with new features that might better suit your current needs. The longer you've been paying off your current home loan, the more likely it is that your needs have changed.

There's also a chance that market rates have changed, too.  In fact, it's a good idea to set an annual reminder to check how your home loan compares to the current home loan deals out there.

When done smartly, refinancing can do you and your bank account a world of good. Here are some of the top reasons why you might choose to refinance your home loan:

1. You're renovating or moving home

You may be able to access your home equity and get a cash out refinance to help fund your renovation project or moving expenses.

2. You want to access additional features

You could save thousands of dollars by taking advantage of improved market conditions and features like:

• an offset account
• flexible repayments
• redraw facilities
• changing to a fixed or variable rate
• loan splitting
• lower interest rates
   

3. You're looking to consolidate your debts

You can sometimes streamline your finances by consolidating your other debts, like credit cards or car and personal loans, under a new home loan.

4. You want to amp up your investment game

If you have enough, you could refinance to access your home equity for investing in shares or other property, which may also provide tax benefits.

If you've decided refinancing is right for you, you'll need to get a few things in order to make it happen. 

Here's a step-by-step guide to refinancing your home loan.

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