How to Compare Home Loan Refinancing Costs

Record the existing loan first

Start with the current balance, remaining term, repayment type, rate and fees. Ask the existing lender for the discharge position. A comparison is easier to interpret when both options use the same balance and remaining term.

Use a dated written offer

Rates displayed in a calculator are assumptions. Ask the new lender about the actual rate, eligibility, fees, features and conditions. An advertised rate or comparison rate does not establish the cost for every loan size or term.

Include switching costs

Check discharge, application, valuation and registration charges and any break costs. Product features such as offset and redraw can differ. Keep each cost visible rather than comparing only the monthly repayment.

Avoid resetting the term silently

Extending the term can reduce the payment while increasing total interest. Compare equivalent remaining terms first, then model a term change separately. Record the assumptions and compare total costs as well as cash flow.

Treat incentives cautiously

Cashback and promotional conditions can change. A payment does not establish a net saving once rate differences and switching costs are considered. Check lender serviceability and avoid treating a calculator result as an approval.

Official guidance

ASIC Moneysmart switching guidance and the calculator can help organise the comparison. General education only; obtain current lender terms and licensed assistance.