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Calculations are estimates and provided for illustrative purposes only. They do not take into account your personal circumstances, any product features, applicable fees, or charges which may be payable. Calculations are not an offer of credit, a quote or loan approval. Applications to lenders are subject to lending criteria.
Time
All months are assumed to be of equal length. In reality, many home loans accrue on a daily basis leading to a varying number of days' interest dependent on the number of days in the particular month. One year is assumed to contain exactly 52 weeks or 26 fortnights.
Interest Rate
The introductory interest rate is considered to be the same for the duration of the introductory period you specify. The ongoing interest rate is considered to be the same for the remaining duration of the loan.
Fees
Up-front fees are added to the value of the loan at the start of the term. Regular fees are charged at the end of each monthly repayment period, prior to the repayment being made. If the regular fee frequency is not monthly, then an equivalent fee for a monthly period is used.
Repayment Amounts
Repayments are calculated so that the loan is paid off at the end of the specified term remaining. Repayments are rounded to the nearest cent. Repayments are calculated assuming a principal and interest repayment over the loan term. Repayments are assumed to be on a monthly basis and incorporating the round up figure.
Results Graph
The results shows the estimated savings resulting from switching loans if you make the minimum repayments required under the existing loan to both loans. The estimated savings are the amount by which the amount outstanding on the new loan is less than what would have been owed on the existing loan at the same point in time. An adjustment is made in the last period to allow for the fact that a lower repayment may be required for the loan that is being repaid.
Mortgage switching serves many purposes, such as gaining lower interest rates or better loan features. Thankfully, there are tools such as our Mortgage Switching calculator to help you see for yourself. Mortgage switching, more commonly referred to as refinancing, is the process of changing your current home loan to another. This can either be changing the loan product but staying with the same lender or changing lenders all together.
To determine if you are eligible you can use our Income Tax Calculator and Credit Score Calculator.
If you’re deciding whether or not you want to switch mortgages, there are many benefits that should be considered when you make a decision.
First and foremost, refinancing to another loan product or lender could save you thousands! As market rates are constantly changing, you may be able to achieve lower interest rates by refinancing. You can use our Home Loan Comparison Calculator to see how much you could save. Other benefits include:
When switching mortgages, the process is similar to that of applying for your original home loan. This means that the average time for refinancing is roughly 4-8 weeks. However, this time frame can vary, depending on the mortgage provider and your situation.
It's also worth noting that, as you are already the owner of the property, it's generally a more relaxed process in the event that you encounter any delays or challenges and need to delay your settlement.
This process can be done online with many lenders, or on the phone or through a broker. Some factors that may influence the speed of your refinance include:
While switching mortgages may help your savings in the long run, it is worth being aware of the costs associated with the process. These costs include:
To get a better understanding of how much these costs may set you back, it is worth utilising online tools such as our Lender's Mortgage Insurance Calculator and our Refinancing Costs Calculator.
While switching your home loan could save you money, it’s important to look at the full picture and make sure that the costs don’t outweigh the savings. Important things to consider include:
There are no rules about how often you can refinance your home. However, right now Australians are refinancing far more often than they used to. Currently the average duration of a home loan in Australia is 4-5 years, meaning, home owners are, on average, switching their mortgages within a 4-5 year period.
It’s recommended you regularly review your financial commitments as your circumstances change (such as switching jobs, having kids, etc.), including your home loan. More specifically, good times to consider refinancing include:
It's worth noting that refinancing is not the best option for everyone and it's important to do your research before making a switch.
Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to made on variables as selected and input by the user. All products will list the LVR with the product and rate which are clearly published on the Product Provider’s web site. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. Rates correct as of 12 September 2024.
^The addition of offset sub-account means your comparison rate will change.
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Savings.com.au
Savings.com.au Pty Ltd ACN 161 358 363 | Australian Financial Services Licence and Australian Credit Licence 515843