When Should I Consider Refinancing My Home Loan?

There is no set number of years you should wait before refinancing a home loan. The right time to review your mortgage is when your current loan no longer appears competitive, your circumstances have changed or another suitable loan may better support your financial goals.

Our home loan refinancing service explains how CBM Mortgages can review your existing loan, compare suitable alternatives and help you understand whether refinancing may be worthwhile.

Refinancing does not automatically mean changing lenders. A home loan review may show that your existing lender can offer better pricing, that another lender has a more suitable option, or that staying with your current loan makes more sense once all costs are considered.

When should I consider refinancing my home loan?

There are several situations where reviewing your existing mortgage can make sense.

1. Your current interest rate is no longer competitive

Interest rates and lender pricing change over time. A loan that was competitive several years ago may not remain competitive today.

Moneysmart’s guidance on switching home loans notes that there can be a difference of more than 2 percentage points between variable home loan rates available in the market.

That does not mean every borrower will qualify for the lowest advertised rate. Your loan amount, property value, loan-to-value ratio, credit profile, loan purpose and lender policies can all influence the rate available to you.

If you are unsure how your existing mortgage compares, our guide to comparing your home loan explains what to look at.

2. Your lender has changed your interest rate

A lender rate change can be a useful trigger for a home loan review.

The Reserve Bank cash rate is an important influence on home loan pricing, but lenders also make their own pricing decisions based on funding costs, market conditions and competition.

If your rate changes, check what the new repayment means for your household budget and whether better pricing may be available.

Our article on why lenders can change home loan rates independently of an RBA decision looks at this issue in more detail.

3. Your fixed-rate period is approaching expiry

The end of a fixed-rate period is another logical time to review your mortgage.

You may need to consider whether to move onto your lender’s variable rate, fix again, split the loan between fixed and variable portions or investigate refinancing.

Start early enough to understand your options rather than automatically accepting whatever rate applies when the fixed period ends.

Our guide to what happens when a fixed-rate home loan ends explains the choices in more detail.

4. Your income or financial circumstances have changed

Your home loan should continue to suit your circumstances rather than simply remaining unchanged for decades.

A review may be worthwhile after changes such as:

• a significant increase or decrease in household income;
• starting or growing a family;
• changes to employment;
• paying off other debts;
• a change in regular household expenses; or
• a change in your short-term or long-term financial plans.

Changes in your circumstances do not automatically mean refinancing is appropriate, but they can change the types of loan features and repayment structures that may suit you.

5. You want different home loan features

The lowest interest rate is not the only consideration when reviewing a mortgage.

You may want access to features such as:

• an offset account;
• redraw;
• additional repayment flexibility;
• a different fixed or variable structure; or
• loan features better suited to your plans.

Features can come with costs, so they should be useful to you rather than selected simply because a loan includes them.

Moneysmart recommends considering both the interest rate and loan features when comparing home loans.

6. Your property equity has increased

Your equity position may change as you repay the mortgage or if the property’s value changes.

A lower loan-to-value ratio may affect the refinancing options available to you.

However, the property still needs to be acceptable to the new lender and refinancing remains subject to a new lending assessment.

7. You are planning a renovation, construction project or property purchase

A future property or renovation plan can be an appropriate time to review your overall lending structure.

Different lenders have different policies and loan products, so it can make sense to consider the planned transaction before refinancing rather than switching lenders and discovering later that the new lender does not suit your next objective.

8. You want to access equity

Some borrowers refinance to access equity for purposes such as renovations or another property purchase.

Accessing equity means increasing or restructuring debt and requires lender approval. It should therefore be considered in the context of your repayment capacity, financial objectives and overall risk.

Should I refinance just because another lender has a lower rate?

Not necessarily.

A lower advertised interest rate can be attractive, but the decision should consider the whole loan.

Relevant factors include:

• the interest-rate difference;
• discharge and switching costs;
• any fixed-rate break costs;
• possible lenders mortgage insurance;
• new-loan fees;
• ongoing fees;
• loan features;
• the new loan term; and
• whether the loan is suitable for your circumstances.

Our guide to the costs of refinancing a home loan explains these expenses and how to think about the break-even period.

Should I ask my existing lender for a better rate first?

Yes, this can be a sensible first step.

Moneysmart recommends asking your existing lender for a better deal before switching. A lender may be prepared to reduce its pricing to retain your business.

You can then compare the revised offer with suitable alternatives rather than assuming refinancing is automatically necessary.

Can I refinance if my borrowing capacity has changed?

Refinancing involves a new credit assessment.

Your current repayment history does not automatically guarantee that another lender will approve a new loan.

Lenders may consider factors including:

• income;
• living expenses;
• existing debts;
• credit card limits;
• credit history;
• property value;
• available equity; and
• the repayments on the proposed loan.

If standard serviceability is making refinancing difficult, our guide to refinancing when serviceability is a problem explains the issue in more detail.

How often should I review my home loan?

There is no mandatory review period.

Rather than refinancing according to a calendar, it can be more useful to review the loan periodically and when there is a meaningful change in:

• interest rates;
• your lender’s pricing;
• your income or expenses;
• your equity position;
• your loan requirements; or
• your future financial plans.

A review also does not have to result in refinancing. Sometimes the best outcome may be negotiating with your current lender or leaving the loan unchanged.

How do I decide whether refinancing is worthwhile?

Start by establishing your current loan position and then compare it with realistic alternatives.

You should know:

• your current interest rate;
• your outstanding loan balance;
• your remaining loan term;
• your current repayment;
• your existing loan features and fees;
• your approximate property value;
• the cost of leaving your existing loan; and
• the costs and features of the proposed new loan.

Moneysmart’s Mortgage switching calculator can help estimate whether switching could save money and approximately how long it may take to recover the cost of changing loans.

The calculator is a useful starting point rather than a prediction or guarantee of loan approval.

Frequently asked questions

Disclaimer: This article provides general information only and does not constitute personal financial, legal, tax or credit advice. Interest rates, fees, lender policies and lending criteria can change. Consider your circumstances and obtain advice appropriate to your situation before changing a loan or applying for credit.

Written by Craig McDonald. Updated November 2026.