When is the right time to talk to the bank about my home loan?

Author: ME

Published at: 6/21/2016 3:28:58 PM



If you plan to refinance your home loan, it pays to act sooner rather than later.


Gone are the days when we stayed with one lender for the full term of our home loan. Australians are taking advantage of a highly competitive home loan market to refinance their loans, and there can be a whole variety of reasons behind the decision to refinance.


Refinancing your home loan can provide low cost funds for a whole variety of purposes; it’s an opportunity to consolidate debt; or it may mean saving on interest costs with a lower loan rate. 


Speak to lender sooner…rather than later


The bottom line is that there is a particular stage at which home owners start to consider refinancing their home loan. But a common thread is the value of speaking with your bank sooner rather than later.


This is especially important if you’re refinancing your home loan to pay for a major project like home improvements, the purchase of an investment property or even to head off on a once-in-lifetime holiday.


By discussing your plans with your bank at an early stage, you will have a much clearer idea about how much you can borrow by refinancing, and this gives you a firm spending budget for your project.


Getting your ducks in a row


Taking an organised approach to your home loan refinance can speed up the process. Ideally, you should have all the paperwork on hand. This includes proof of income - like a few months’ worth of pay slips, plus your home loan, credit card and personal loan statements that will give your bank a complete picture of your current finances.


Be prepared to spruce up your place a little too. Your bank may want to have your home valued as part of the loan refinance process. Presenting your property in its best possible light could be the factor that gets your loan request over the line.