Refinancing Your Home Loan: When It Actually Saves Money

Refinancing your home loan is often pitched as an easy way to “save thousands.” Sometimes that’s true. Other times, refinancing mainly benefits the lender—or costs more than it saves once fees and fine print are counted.

In 2026, with many Australians under pressure from higher living costs, refinancing decisions deserve a closer look. The key question isn’t whether refinancing is possible—it’s whether it actually improves your financial position.

What Refinancing Really Means

Refinancing involves replacing your current home loan with a new one, either with the same lender or a different lender.

• The old loan is closed and paid out
• A new loan is established, often with new terms and features
• Fees and checks apply as if it were a new application

This reset can lower costs—or quietly add new ones.

When Refinancing Is More Likely to Save Money

1. Your interest rate is meaningfully higher than current offers

A small rate cut doesn’t always justify the switch. Refinancing tends to work better when the difference is large enough to offset fees within a reasonable timeframe.

2. You plan to keep the loan for several years

Upfront costs are usually recovered gradually through lower interest. If you expect to sell or refinance again soon, savings may never materialise.

3. You have sufficient equity

Borrowers with lower loan-to-value ratios (LVRs) often qualify for better rates and avoid lenders mortgage insurance.

4. You can improve loan features

Switching to a loan with a full offset account, lower ongoing fees, or better redraw rules can improve long-term outcomes beyond rate savings alone.

When Refinancing Often Doesn’t Pay Off

1. Break costs outweigh interest savings

If you’re on a fixed-rate loan, breaking it early can trigger significant costs—sometimes wiping out years of potential savings.

2. Fees cancel out the benefit

Application fees, discharge fees, valuation costs, and ongoing package fees can add up quickly.

3. Your financial position has weakened

Changes in income, expenses, or employment status can limit approval options or lead to less favourable terms.

4. You extend the loan term without realising it

Resetting a 30-year term can lower monthly repayments but increase total interest paid over time.

A Simple Example (Illustrative Only)

If refinancing reduces your interest rate by 0.5% on a $500,000 loan, interest savings may build gradually. However, if upfront costs total several thousand dollars, it may take years to break even.

This is why timing and loan tenure matter as much as the rate itself.

What to Check Before Refinancing

• Total upfront and ongoing fees
• Break costs on your current loan
• New loan’s revert rate (if fixed)
• Offset and redraw features
• Whether the loan term resets

How Refinancing Fits Into a Bigger Financial Plan

Refinancing works best when it supports broader goals: improving cash flow, reducing interest over time, or simplifying finances.

For households under pressure, maintaining repayment buffers and avoiding high-interest debt often matters more than chasing marginal rate reductions.

Quick Q&A: Home Loan Refinancing

• Q: How often should I refinance?
  A: There’s no fixed rule. Many borrowers review options every few years or after major life changes.
• Q: Does refinancing hurt my credit?
  A: Applications involve credit checks, but a single refinance typically has limited impact.
• Q: Can refinancing increase total interest paid?
  A: Yes, especially if the loan term is extended without higher repayments.

Disclaimer: This article is for general information only and is not financial, tax, or legal advice. Home loan products and rules vary by lender and can change. Consider checking official lender documents or speaking with a licensed professional before making major decisions.

First Home Buyer Benefits Australians Forget to Claim

Buying your first home in Australia is already stressful—so it’s no surprise many buyers overlook government support they’re entitled to. Yet every year, thousands of first home buyers miss out on benefits simply because they didn’t know they existed, misunderstood eligibility rules, or applied too late.

As housing affordability remains a challenge in 2026, understanding these benefits can materially affect upfront costs and long-term affordability. While not every buyer qualifies, many do—and only discover it after settlement, when it’s too late.

Why First Home Buyer Benefits Are Often Missed

Unlike a single national program, first home buyer assistance in Australia is spread across federal, state, and territory rules.

• Different states offer different grants and duty concessions
• Eligibility depends on price caps, residency rules, and timing
• Some benefits must be claimed before settlement

This complexity means buyers often focus on finance approval and forget to double-check what support applies.

Common First Home Buyer Benefits Australians Forget

1. Stamp Duty Concessions or Exemptions

Stamp duty relief is often more valuable than cash grants, but many buyers assume they won’t qualify.

• Available in most states for eligible first home buyers
• Property value thresholds vary widely
• Often applies to both new and established homes

In some cases, buyers only realise after settlement that they paid duty unnecessarily.

2. First Home Owner Grant (FHOG)

The FHOG still exists in most states, but is generally limited to new or substantially renovated homes.

• Grant amounts and property caps vary by state
• Occupancy requirements must be met
• Applications usually must be lodged within strict timeframes

3. First Home Super Saver Scheme (FHSSS)

The FHSSS allows eligible buyers to save part of a deposit through superannuation.

• Contributions must be made before signing a contract
• Release of funds follows ATO procedures
• Misunderstanding timing rules is a common mistake

4. State-Based Shared Equity or Deposit Schemes

Some states offer shared equity or low-deposit schemes that reduce the amount buyers need upfront.

• Often limited to specific income and price caps
• Places may be capped each year
• Applications can close quickly once limits are reached

5. Lenders Mortgage Insurance (LMI) Waivers

Some first home buyers qualify for LMI waivers through specific lenders or government-backed programs.

These are often missed because they depend on lender policy, profession, or participation in guarantee schemes.

Who Is Most Likely to Miss Out

• Buyers focused only on purchase price, not total costs
• People buying across state borders
• Those using family help but not professional advice
• Buyers rushing to meet settlement deadlines

What First Home Buyers Should Check Before Buying

• Your state or territory revenue office website
• Property price caps for grants and concessions
• Occupancy and residency requirements
• Application deadlines relative to contract and settlement dates

Checking early can prevent costly oversights.

How These Benefits Fit Into a Bigger Buying Plan

First home buyer assistance rarely makes a home “cheap,” but it can improve cash flow and reduce upfront strain.

For many households, the priority remains affordability under higher interest rates, not maximising every incentive.

Quick Q&A: First Home Buyer Benefits

• Q: Can I claim benefits after settlement?
  A: Usually no—many benefits must be applied for before or at settlement.
• Q: Do benefits apply to investment properties?
  A: Generally no. Most require owner-occupation.
• Q: Can rules change year to year?
  A: Yes. State and federal programs can change eligibility and caps.

Disclaimer: This article is for general information only and is not financial, tax, or legal advice. First home buyer rules vary by state and can change. Check official government guidance or seek professional advice before making decisions.