February 2026 Property Update: Rising Borrowing, Higher Rates and New Lending Rules
It is shaping up to be a decisive start to 2026. Borrowing activity is lifting. Interest rates have moved again. Rental markets remain tight. Property...
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Refinancing is generally a good idea for most borrowers but there situations where switching loans just isn’t worth it. Here are a few examples:
- You have a fixed rate home loan with a very high exit cost and the cost of fees could outweigh the benefits of refinancing until the fixed rate period expires.
- You are looking at selling your property in the near future and you won’t keep the loan long enough to make any decent savings.
- The size of your loan may be too small to have any significant interest savings. After taking into account the fees associated with refinancing, it may not be worthwhile to move to a new lender.
- Your property has dropped in value and your overall Loan To Value ratio (LVR) is higher than 80%. This mean you may pay Lenders Mortgage Insurance again if you switch to a different lender.
- Refinancing your loan for a longer term which could result you in paying more interest over time.
It is important to understand your goals and objectives for refinancing to work out if this is suitable to you.
Related FAQs
What is Refinancing?
Refinancing is a process of taking out a new loan to pay off the existing loan typically at a lower rate or for better features. People wanting to change their home loan is usually because of a change in the circumstances or goals which can be a smart way to manage money. It may give you the option of securing a lower interest rate, consolidating debts or unlocking equity from your current property. Speak with one of our mortgage brokers and find out if refinancing is right for you.
Why do people refinance?
Refinancing can be used for various reasons, which include but aren’t limited to: Home Renovations, Reducing monthly repayments, Lowering your interest rate, Cashing out your Home Equity, Raise cash for another purchase (another house, car, boat etc), Access Additional home loan features (offset account, redraw facility etc.), Borrow additional funds
How much does it cost to refinance?
Refinance can help you save money and own your home sooner however there are costs involved in refinancing from one lender to another lender.
When you shouldn’t consider refinancing your property?
Refinancing is generally a good idea for most borrowers but there situations where switching loans just isn't worth it.
How can I consolidate my debt and is it a good idea?
Debt consolidation is when you payoff your existing debts such as credit cards, personals and car loans with a new debt.
