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Most homeowners will have thought about refinancing at some point. It can be a great way to save money and adjust to changes in your personal and financial circumstances.  

It’s important to regularly consider refinancing, but just how often should you refinance your home loan?  

In this article we’ll explain what you need to know about refinancing, including when and why you should do it. 

- __Related:__ [How to negotiate a lower interest rate on your home loan ](https://www.lendi.com.au/inspire/finance/how-to-negotiate-a-lower-interest-rate-on-your-home-loan/)
- __Related:__ [How much does it cost to refinance?](https://www.lendi.com.au/inspire/finance/how-much-does-it-cost-to-refinance/) 
- __Related:__ [Guide to home equity loans](https://www.lendi.com.au/guides/equity-home-loans/) 

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## What are the benefits of refinancing your home loan? 

There are a range of reasons why a homeowner might consider refinancing. One of the most common reasons to refinance is to save money — usually by getting a lower interest rate.  

Even a marginally lower interest rate can make a big difference in the overall amount you’ll pay towards your loan. 

There are several reasons why a refinance might be worth it. These include: 

- It's been a while since you last refinanced and there are options on the market that will better suit your needs 
- You're interested in modifying your loan term or features to better align with your needs 
- You improved your credit score, making you eligible for more competitive deals 
- You’d like to tap into your home equity for purposes such as renovating your home, undertaking a project or going on a holiday. 
- You're looking to switch lenders or loan products to find a better fit 
- You’d like to consolidate your other debts into your home loan, to simplify your monthly repayments 
- You’d like to change loan or repayment types (e.g. from a variable rate to a fixed rate or from interest-only repayments to an owner-occupier loan) 

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## How do you know if your interest rate is still competitive? 

You might get a better idea of whether your interest rate is still competitive by keeping up with market changes and cash rate movements. 

To make sure you’re still on a competitive rate, do some research every 12-18 months to see how your lender’s interest rate and home loan compares to the market.  

You can easily do this online by [comparing your options in one place with Lendi](https://www.lendi.com.au/home-loans/basics/refinance/). This will allow you to get a tailored shortlist of loans you might be eligible for. 

It’s also smart to see what interest rates your existing lender is offering to new customers. 

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## What do you do if you think your interest rate is too high? 

So, you’ve compared your home loan interest rate and found better rates.  

If your current lender is offering better rates to new customers, don’t be afraid to ask them to match this lower rate. Our Home Loan Specialists are happy to negotiate on your behalf, if you’d prefer. 

Don’t forget that home loans are more than just their interest rates. Many home loans have fees attached to them (e.g. establishment and annual fees) that can contribute to the overall cost of the loan.  

There are also a number of costs associated with refinancing, so it’s important to calculate those and see if it will still benefit you in the long term. 

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## How often can you refinance your home loan? 

There are no set limitations on how often you can [refinance your home loan](https://www.lendi.com.au/home-loans/basics/refinance/loan-amount), but there are factors to consider to ensure you’re getting the best out of your refinance.  

Firstly, it’s important to weigh the potential pros and cons of refinancing, and that means finding out if the savings outweigh the [refinancing costs](https://www.lendi.com.au/inspire/finance/how-much-does-it-cost-to-refinance/) involved. 

Typically, you’ll want to have at least 20% equity in your home before you refinance to avoid paying [Lenders Mortgage Insurance (LMI)](https://www.lendi.com.au/guides/lmi/). Remember that equity is calculated by working out the difference between your loan balance and your property’s current value.  

Everyone has different circumstances. Sometimes it can make sense to refinance after 6 months. For other borrowers, this might be 2 years.  

Generally speaking, it’s a good idea to look into refinancing every couple of years, but you can research and compare interest rates more frequently. 

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## How fast can you refinance a home loan? 

The [time it takes to refinance](https://www.lendi.com.au/inspire/finance/how-long-does-it-take-to-refinance/) can vary depending on the lender’s processing times, your preparedness and the complexity of the loan.  

If you're lucky, you may be able to refinance in as little as a week but typically it can take anywhere between 30-45 days, or up to 2 months if there are delays. 

If speed is a priority for you, we recommend speaking to a [Home Loan Specialist](https://www.lendi.com.au/book-appointment/). They'll have better insight into which lenders may have faster loan application processing times vs. which ones might take a little longer. 

It's also a good idea to use an online mortgage platform to [compare and apply for your refinance in one place](https://www.lendi.com.au/home-loans/basics/refinance/loan-amount). This can be much faster than jumping from bank to bank to compare options on your own and commuting to a local brand to go through the refinancing process. 

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## Can you refinance a fixed rate home loan? 

You can still refinance when your home loan has a fixed interest rate, but there are some things you should think about before going ahead. 

Fixed rate home loans are only fixed for a short period of time — usually between 1 and 5 years. If you want to refinance during the fixed period, you may be hit with [break costs](https://www.lendi.com.au/inspire/finance/is-it-woth-breaking-your-fixed-rate-home-loan/). So, you may want to wait until your fixed period is over before you refinance, depending on your situation. 

[Break costs](https://www.lendi.com.au/inspire/finance/is-it-woth-breaking-your-fixed-rate-home-loan/) are fees charged by lenders when borrowers ‘break’ their home loan — usually by refinancing before the fixed period is over.  

__💡 Did you know?__ Lenders charge break costs to cover the financial loss associated with breaking a fixed rate. 

Before you refinance, [contact a Home Loan Specialist](https://www.lendi.com.au/book-appointment/) or your lender to find out what you can expect to pay in break fees.  

Some lenders may not charge you for breaking your loan if you refinance with the same lender. 

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## Got a home loan question? Just ask!
We're here to help. Get free expert advice at a time that suits you. Choose a time to chat with a [Home Loan Specialist here](https://www.lendi.com.au/book-appointment/)

*The information in this post is general in nature and should not be considered personal or financial advice. You should always seek professional advice or assistance before making any financial decisions.*