How Often Can You Refinance Home Loan

Hendrix on 13/07/2022 - 12:45

HI All

I refinanced my home loan about 3 months ago. I received a lower rate and 3k cashback.

With the recent rate rises my new bank has passed on every rate rise in full. There are a number of providers offering a lower rate for new customers with up to 4k cash back

My question is how often can I refinance without ruining my credit rating or getting rejected by new banks. I know 3 months is probably too short. previously I was thinking two years but it would be better to make it a shorter period?

thanks

Financial Home Loan

Comments

  • bobbified on 13/07/2022 - 13:00
    +8

    As many times as they're willing to lend. It's going to depend on your circumstances and their criteria each time you apply.

    • BigTed on 13/07/2022 - 18:04
      -1

      Each application will be reflected on your credit check.
      Too many application will scare some lenders off.

  • fullmetal on 13/07/2022 - 13:06
    +3

    I was doing it every 12 mths but my most recent change was 6 mths. I am thinking of changing again as the current bank refuse to match their offer to new customers. Similar reason why I changed 6 mths ago.

    • autonomate on 03/08/2022 - 13:32

      Have you got a spreadsheet of your total overall costs over the past few years?

      I'd be interested to see what the total $ difference would be after fees, and comparing with what would have happened if you stayed with a lender.

      I think if you're getting ridiculously low introductory rates or there's an absurdly large cashback/benefit being offered, this is a good move. Obviously cashbacks are better for smaller loans, and very low rates are better for larger loans.

  • timothy2 on 13/07/2022 - 13:13
    +2

    I tried to refinance three times within a 6 month period. First two times was no worries, 3rd time I was knocked back (circumstances hadn’t changed so assumed I was considered a flight risk). Brokers have told me at least 6 months before I can try again, which is right about now :)

  • TheSpiffyAquarius on 13/07/2022 - 13:19

    who you refinance with do they still do 3k cashback, i'm looking to refinance my home loan.

    • Hendrix on 13/07/2022 - 13:28

      There are heaps of banks offering a cashback . I refinanced with ING. St George is currently offering 4k

    • tomclancy on 14/07/2022 - 21:11

      AMP just started $5k cashback

      • TheSpiffyAquarius on 14/07/2022 - 22:53

        Thanks, it keeps getting better…

      • Whatisthatvelvet on 15/07/2022 - 08:23
        +1

        Min loan amount of $1M for the $5k rules me out

      • autonomate on 03/08/2022 - 13:33
        +2

        OneTwo is doing $5K cashback for 500K+ loans at 80% LBR and 2.5K matching contribution to your loan from the lender if you pay off $2.5K more during the first 12 months.

        • Kinko82 on 06/08/2022 - 19:11

          That is an unbelievable cash back offer. Looks like this company is owned by Lendi and ANZ.

          • autonomate on 07/08/2022 - 15:26

            @Kinko82: Yeah they're trying to eat marketshare to get back in 3rd place.

  • Bangers on 13/07/2022 - 13:23
    +1

    For those serial refinancers who do it through a broker, how do you and your broker handle the broker commission clawbacks?

    • Hendrix on 13/07/2022 - 13:45
      +2

      The brokers won't like it if you refinance before two years because they will loose part of their commission. You can probably get their help on the first refinance as long as it has been two years

      • Mulga Bill on 13/07/2022 - 13:58
        +2

        Yes, be carful with this, I work for a bank and had a customer who had "unknowingly" signed a documents stating that the customer was liable to cover the clawback if refinanced too soon.

      • fredblogs on 13/07/2022 - 14:15

        Do you need to use a broker in that case?

      • MiguelSanchez91 on 13/07/2022 - 14:18

        Will lose all of their commission*

    • Some Human on 13/07/2022 - 20:28

      I went through a broker to get the loan, then refinanced a year later. The broker sent me a bill for $1k. I had previously signed something saying I would pay 1k if I refinanced within 2 years. So I just paid them their money and that was it.

    • Kinko82 on 06/08/2022 - 19:12

      Best you let the broker know your intentions so they can politely decline as the broker will need to refund their commission in full if you refinance within 12 months.

  • Hendrix on 13/07/2022 - 13:27

    Athena seem like they are ok because their existing customers get the same rate as new but they don't have cash back.

  • Brainwhacker on 13/07/2022 - 13:50

    Hi Hendrix,

    Sounds like this is something which needs to be done regularly to take advantage of the cashbacks - check tax impact if its for investment property.
    Just wondering which financier is offering $4K, ANZ had it until 30 June,
    They also had a fasttrack refinancing portal for PAYG earners which only required minimal info. With brokers they get a fixed fee but the trailing commissions only kick-in after a period of time - this could vary , Iam not sure.

    Regards

  • El-Rhi on 13/07/2022 - 19:09
    +4

    My shortest has been one month… have done that a few times. I average 4 per year, so every three months seems to be the sweet spot.

    • TheSpiffyAquarius on 13/07/2022 - 20:53
      +1

      so you would have cash in easily 10K?

      • El-Rhi on 14/07/2022 - 07:11
        +1

        Yes, over a year $10k is easily achievable. I’ve been doing it for a few years so you do the math

        • fredblogs on 14/07/2022 - 12:14

          How much of your time does it take?

          • El-Rhi on 14/07/2022 - 12:39
            +1

            @fredblogs: I’d say 4-5 hours per refinance

            • fredblogs on 14/07/2022 - 13:57

              @El-Rhi: I'd probably do it but I like CBA's credit card and web portal better than the other banks

              • Whatisthatvelvet on 14/07/2022 - 17:23
                +2

                @fredblogs: Just refinance the home loan and don't set up cc or use the new banks accounts

                I have refinanced ppor and ip a few times each but still keep my CBA everyday account as have had it forever

                • fredblogs on 14/07/2022 - 18:54

                  @Whatisthatvelvet: think my CBA credit card is normally $395 but covered by the home loan package fees (full offset)

            • impoze on 07/08/2022 - 10:49

              @El-Rhi: So no broker since they would have clawback?

              • El-Rhi on 07/08/2022 - 15:33

                @impoze: No broker… always go direct to the bank

                • impoze on 07/08/2022 - 20:21

                  @El-Rhi: Do you find many have t&c about the net balance re. Offset?

                  • El-Rhi on 08/08/2022 - 06:58
                    +1

                    @impoze: None that I know of. It’s usually brokers who put these conditions on if they pay an additional broker cashback

    • Hendrix on 14/07/2022 - 08:54
      +1

      Wouldn't you eventually run out of banks? Have you done the same bank multiple times?

      • El-Rhi on 14/07/2022 - 10:14
        +2

        You can do the same bank multiple times, but most have a policy for 1 cashback per 12 month period

  • JIMB0 on 14/07/2022 - 09:00
    +1

    A few times a year.

  • impoze on 02/08/2022 - 23:26

    previously broker said won't be able to get cashback if there is already 100% of the loan in offset, anyone know about this?

    thanks

    • tomclancy on 03/08/2022 - 00:38
      +1

      Different lenders have different T&Cs around this. Best check your exact T&Cs for clarification. Purely as an example, Reduce Home Loans scale their cashback based on the net loan balance (i.e. total loan less offset balance) ** at the and of the month of settlement. So you can deposit the 100% into your offset in month 2 and you meet the eligibility for the cashback.

      however: where an offset account applies the loan amount* is the difference between the drawn loan amount and the credit balance in the offset account, as at the end of the month the loan settled.

    • routard12 on 10/09/2022 - 18:05
      +2

      Not valid for westpac. Fully offset and $5k in the bank.

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