TL;DR — Key takeaways
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Most Australians know they should refinance. Few actually do it, because the process feels complicated. It isn’t. Once you understand the six steps, the paperwork involved, and what a broker handles on your behalf, refinancing is far more straightforward than it looks.
This guide covers the complete process from start to settlement, including what documents you need, how long each stage takes, and the traps to avoid. If you want to understand whether refinancing is worth it first, read our guide on when to refinance. If you’ve already decided and want to run the numbers, use our loan repayment calculator. This article covers the how.
How long does refinancing take in 2026? Most refinances complete in 2 to 6 weeks from application to settlement. Simple cases with a broker and clean documents can settle in under 3 weeks. Delays usually come from slow valuations or missing paperwork.
Step 1: Check whether refinancing is actually worth it
Before you do anything else, check the gap between your current rate and what’s available on the market. If the gap is less than 0.3%, switching probably doesn’t make financial sense once you factor in costs. If it’s 0.5% or more, it almost certainly does.
Two quick things to check before you proceed:
Before contacting any new lenders, call your existing lender and say you’re considering refinancing. Ask them to match a competitor’s rate. Retention teams often have access to rates that aren’t on their public website. This takes 10 minutes and occasionally solves the problem without any paperwork.
Step 2: Compare lenders (or use a broker)
You can approach new lenders directly, or work with a mortgage broker. Both paths lead to the same outcome. The difference is time, access, and negotiating power.
For most borrowers, a broker saves time and often finds a better rate. They handle the comparison, the application, the document collection, and the follow-up with the lender. All you do is provide the documents and sign the forms.
Step 3: Gather your documents
Delays in refinancing almost always come from missing or incomplete documents. Get these ready before you start the application. Lenders need to verify your income, your existing loan details, and your identity.
Good to know: If any of your statements show unexplained large transfers, gambling transactions, or overdrafts, lenders will ask about them. A broker can advise how to address these before they become an issue in assessment.
Step 4: Submit your application
Once you’ve chosen a lender, you (or your broker) submit a formal refinance application. The lender then runs a credit check and assesses your serviceability, which is their calculation of whether you can afford the repayments at a stress-test rate (typically around 3% above the product rate).
This stage takes 3–10 business days depending on the lender. Some of the major banks are slower than specialist lenders or non-bank lenders. If speed matters, your broker can advise which lenders are currently running fastest.
Try not to apply to multiple lenders at once. Each application triggers a credit enquiry, and multiple enquiries in a short period can lower your credit score and raise questions with lenders. A broker submits to one lender at a time based on which is most likely to approve at the best rate.
Step 5: Property valuation
After the lender conditionally approves your application, they order a property valuation. This confirms the property’s current market value, which determines your LVR and influences the rate you’re offered.
There are two types:
If the valuation comes in lower than expected, your LVR will be higher than anticipated. This can affect the rate tier you qualify for, or in edge cases, trigger an LMI requirement. If this happens, your broker can advise whether to proceed, renegotiate, or look at another lender.
Step 6: Formal approval and settlement
Once the valuation is complete and the lender is satisfied, they issue a formal loan offer. You review and sign the loan documents. Your new lender then contacts your old lender to arrange the discharge and settlement.
On settlement day, the new loan funds are used to pay out the old one. Your mortgage is now with the new lender at the new rate. Your repayments reset to the new amount from that date.
Typical costs at settlement: Discharge fee to current lender ($150–$500), application or establishment fee with new lender ($0–$800), valuation fee ($0–$500, often waived), government registration fees ($100–$300 depending on state). Total: usually $800–$1,500 on a standard refinance.
The most common refinancing mistakes
Most refinancing problems are avoidable. These are the ones that catch people out:
What happens to your current loan when you refinance?
Your old loan is discharged — that is, fully paid out and closed — on settlement day. Your new lender settles the outstanding balance on your behalf. From that date, you owe the money to the new lender, not the old one. Your direct debits will need to be updated if you had automatic repayments set up.
If you had an offset account linked to your old loan, check whether the new lender offers one and how to move the funds across before settlement. Offset account balances can be significant and you don’t want them sitting in the wrong account during the transition.
Frequently asked questions
Can I refinance if I’m self-employed? Yes. You’ll need your last 2 years of personal and business tax returns plus ATO Notices of Assessment. Some lenders also offer low-doc refinance products for self-employed borrowers with good credit history and equity. A broker can match you to the right lender for your situation. |
Does refinancing affect my credit score? A single formal application triggers one credit enquiry, which typically reduces your score by a small amount temporarily. This usually recovers within a few months. The impact is minimal compared to the financial benefit of switching to a better rate. What does lasting damage is applying to multiple lenders at once. |
Can I refinance and access equity at the same time? Yes. If your property has increased in value, you may be able to borrow more than your outstanding balance — the difference is equity release. This can be used for renovations, an investment property deposit, or other purposes. The new loan amount still needs to pass the lender’s serviceability test. |
How often can I refinance? There is no legal limit on how often you can refinance, but doing it too frequently is counterproductive. Each switch has costs, and frequent switching raises questions with lenders. Most Rateseeker brokers recommend reviewing your loan every 2–3 years, not chasing every rate movement. |
Can I refinance an investment property? Yes. The process is the same, though lenders assess investment loans slightly differently, factoring in rental income and the overall debt exposure. Investment loan rates are typically 0.2–0.5% higher than owner-occupier rates. If you are considering refinancing following the 2026 negative gearing changes, see our guide on how the new rules affect investors. |
What if my application is declined? Ask the lender (or your broker) why. Common reasons include insufficient income relative to debt, a low property valuation, or an LVR above 80% without LMI. Your broker can identify alternative lenders with more flexible criteria, or advise on what to fix before applying again. Do not apply to another lender immediately after a decline — wait for your broker’s guidance. |