Refinancing home loans more popular

Refinancing of home loans topped $1.5 billion in June 2009, which was double the activity of a year ago. This significant jump demonstrates the interest in switching loans, ‘topping up’ and/or debt consolidation at present, as the housing finance activity from first homebuyers begins to relax a little.

Key influences for the rise in refinancing home loans were low rates combined with rising consumer confidence and better-than-expected job stability. It makes sense for a borrower to refinance to a different loan product if it could save them thousands of dollars over the loan term.

Switching to a mortgage with an interest rate 25 basis points lower for a $300,000 loan over 30 years at 5.5% would save you approximately $47 a month - a total of approximately $16,920 over the loan term. Note that there will be costs involved with switching loans.

If you are thinking about refinancing your home loan, speak to the mortgage brokers at Intellichoice first about a free finance health check to ensure that your home loan still suits your current situation. One of our financial advisors will take a look at your mortgage and compare it with other products from their available panel of lenders.