Costs of Refinance

Hey Brokers,

Just hoping for a quick run down of all costs involved in a refinance. Obviously the associated costs change per lender but a price range would be useful. Even for say the big4 as a guide.

This would be based upon no fixed rates or LMI involved.

Thanks in advance

 

Didly squat.

Discharge of mortgage is about $300. Thats about it.

 

Really that's it?
I thought there was a fair bit more involved?
Mortgage registration
Valuation (only some)
Settlement fee
Conveyancer

But if $300 is the case then what happens in situations like CBA's current $1,500 offering? Do they plonk the additional $1,200 into your account free to use on what you want?

 

No conveyancing neded but there may also be a registeatio n of mortgage fee about $115. Some lenders do also charge upfront fees but many dont.

If there is a rebate then you will make a profit.

 

Discharge is about $350, but then govvy charges bring that up to around $500, then any fees the new lender charges - can be application, plus val, plus more govvy costs, plus annual package fee if applicable.

I would say budget for about $1000, then you might be pleasantly surprised if it's cheaper.

 

Thanks Terry and Jess
And just quickly CBA entry costs?

 

Nil. Other than the annual fee

 

As far as I know there will be a settlement cost which CBA will charge I think it is $200. Correct me if i am wrong? Also the registration fee will be charged later.

 

Generally run off $1000 for costs and you should come out slightly under budget. With quite a few lenders offering $1000+ it's very easy to switch for nil or potentially come out ahead.

CBA is $200 in total incoming fees to the bank + annual fee.

 

Could you explain this for those of us who don't understand please Rolf?

 

There's three main elements.

1. Current lender discharge fee (usually from $100 to $500 depending on lender)
2. State govt. fees (will vary but usually around $300)
3. New lender application fee (from $0 to $1k)

From my experience - the average overall cost is around $700 - $1000

Cheers

Jamie

 

Thanks All!
Another question, with a cash offer like CBA, what happens if you refinanced out again in say 6 months. Like broker commission would the bank claw back to the borrower?

 

Usually when you take out loan past 80% LVR you paid LMI.
If you change lenders, you often lose the whole amount and need to pay again.

 

No i dont think so. Broker would get a clawack though.

 

Ahhhh I see. I did a new build at 90% LVR late last year. It's now complete and Val is now at 81% LVR. Not keen to move it just yet as it has almost 5 years of IO left. But you never know. . . .

Thanks @York

 

You becoming a broker @albanga ?

I noticed there's a huge lack of them on the forum

 

... and if you stay with the existing lender, you get a credit for the LMI you've already paid. Topping up the existing loan above 80% means you'd pay a little LMI, but with a credit for the previous LMI. Moving lenders means you pay ALL the LMI again, not just on the increase.

 

Even though you lose the LMI you may still be able to claim the tax deduction for it. Just check with a knowedgeable tax agent.

My bank charges $350 to release every secured property. But the new lender offers a cash back which more than covers this cost.

If there are no break costs and with cash out and a lower interest rate this exercise is very attractive.

 

@albanga I am also in the process of looking to refinance. This link was really useful in my research: Calculate the cost of refinancing your home loan | finder.com.au