Refinancing your home loan means replacing your current loan with a new one, either with your existing lender or a different one. It can save you money on interest, reduce your monthly repayments, or give you access to better loan features. Here's a practical, step-by-step guide to how refinancing works in Australia.

Step 1: Get Clear on Why You're Refinancing

Before you do anything else, be clear about what you're trying to achieve. The most common reasons are: getting a lower interest rate, switching from a revert rate to a competitive variable rate, accessing equity in the property, or changing from a fixed rate to variable (or vice versa).

Your goal affects which lenders and products you should be looking at, and what trade-offs you're willing to make. A broker can help you work through this clearly.

Step 2: Know Your Numbers

Before comparing options, gather your current loan details: your interest rate, remaining balance, loan term, monthly repayments, and any fees for exiting the loan early. If you're on a fixed rate, check whether break costs apply. These can be significant and may affect whether refinancing makes financial sense right now.

Also calculate your current loan-to-value ratio (LVR). If your property has increased in value since you bought it, your LVR may have improved, which opens up better rate options. Below 80% LVR is the target most lenders reward with their sharpest pricing.

Step 3: Compare Your Options

This is where a broker adds real value. Rather than approaching multiple lenders yourself, a broker compares across their lender panel and identifies the options that fit your situation. They account for your specific LVR, income profile, loan size, and any features you want to keep (like an offset account or redraw facility).

When comparing, don't just look at the advertised rate. Factor in the comparison rate, ongoing fees, and whether the new loan has the features you actually need.

Step 4: Prepare Your Application Documents

Once you've chosen a lender, the application process starts. You'll typically need to provide:

  • Proof of identity
  • Recent payslips and/or tax returns (last two years for self-employed borrowers)
  • Bank statements (usually three to six months)
  • Your current home loan statement
  • Council rates notice and/or property information
  • A list of your assets and liabilities

Having these ready before you formally apply speeds the process up significantly.

Step 5: The New Lender Assesses You

Even though you've held a loan and made every repayment on time, the new lender assesses you from scratch. They look at your current income, expenses, debts, and credit profile. Approval isn't automatic, so treat this like a new application.

The lender will also arrange a property valuation to confirm the current value and check your LVR. In a rising market this is often straightforward, but it's worth knowing this step happens.

Step 6: Settlement and Discharge

Once approved, the new lender coordinates settlement. They pay out your old loan, and your previous lender lodges a discharge of mortgage with the Land Titles Office in your state. Your new repayment schedule starts, and you begin making payments to the new lender.

A simple top-up with your existing lender can take one to two weeks. Switching to a new lender typically takes three to four weeks from application to settlement.

How to Refinance Your Home Loan with Swish

At Swish, we handle the refinancing process from start to settlement. We compare across our lender panel, handle your application, liaise with the lenders, and keep you informed at every step. You don't have to manage multiple conversations with multiple banks.

If you're considering refinancing your home loan, book a free call with Swish and we'll assess your current loan and tell you honestly whether there's a better deal available.