refinance frequently

Discussion in 'Loans & Mortgage Brokers' started by RoadRunner, 12th Jun, 2020.

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  1. RoadRunner

    RoadRunner Well-Known Member

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    Is it bad in the eyes of lenders if I am refinancing my loans every 2 years?

    Does it affect my credit history in negative way?

    Reason of refinance could be anything such as - getting low interest rate/lender cashback/helping broker earn etc....
     
    RoadRunner, 12th Jun, 2020
    #1
  2. Jess Peletier

    Jess Peletier Mortgage Broker & Finance Strategy, Aus Wide! Business Member

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    Not a problem generally speaking. :)

    PS - I hope you're one of my clients ;)
     
    Jess Peletier, 12th Jun, 2020
    #2
    inertia, Terry_w and Mumbai like this.
  3. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    It's great to extend loan terms back to 30 years too
     
    Terry_w, 12th Jun, 2020
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  4. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    generally no

    whats the primary focus /goal

    ta
    rolf
     
    Rolf Latham, 12th Jun, 2020
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  5. TforTim

    TforTim Active Member

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    Is 2 years the best frequency to refinance? how about 12 months or 18 months frequency to refinance, does it affect badly to credit report?
     
    TforTim, 4th Dec, 2020
    #5
  6. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    Refinance based on what reason ? If you are happy with the rate and product why refinance at all ?
    Be wary of some brokers who may say otherwise. They may be happy to take on your loan refinance for the trail without reason.

    Also consider if payout fees apply to the existing loan. Some lenders could have penalties of sorts that apply to a early payout - They do this is limit churn.
     
    Paul@PAS, 4th Dec, 2020
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  7. TforTim

    TforTim Active Member

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    based on the no longer discount rates on variable loans,
    eg. Bank only offers discount rates to the new customers and didn't care about existing loans, unless fixed for certain years. and I believe Early Payout only applies to Fixed Loan, not for Variable Loan, isn't it.
     
    TforTim, 4th Dec, 2020
    #7
  8. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    you can always ask the existing bank for a discount
     
    Terry_w, 4th Dec, 2020
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  9. TforTim

    TforTim Active Member

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    the bank amazingly willing to let go (they responded) as reached to maximum discount level, unless to fix it.
     
    TforTim, 4th Dec, 2020
    #9
  10. Peter_Tersteeg

    Peter_Tersteeg Mortgage Broker Business Member

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    There's got to be a reason to refinance. If it's simply to get a better rate, first thing to do is to review your existing loan with your broker. Every lender has 'rate creep' where your rate goes up over time and is no longer competitive, it's very quick and easy to start with the current lender to try get something better. If they won't do better, then consider moving lenders.
     
    Peter_Tersteeg, 4th Dec, 2020
    #10
  11. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    Most lenders tapered the fees from 2011 on variable loans and its a set fee not a major one like a fixed rate break cost. Read the fee disclosure from when the loan started. There will also be statutory and legal costs a old / new lender will impose eg exists costs to refinance elsewhere eg settlement costs, legals, refinance fees, valuation, mortgage registration etc. . Also look at lenders who offer a cashback kick back but be wary of these loans and check its what you want eg offset ? A cheaper rate lender may not offer this.
     
    Paul@PAS, 4th Dec, 2020
    #11