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unlocking the benefits of refinancing


With the mortgage market being competitive and dynamic by nature, it is crucial to ensure that your mortgage is one that suits your financial situation, your lifestyle, and your goals for the future. Getting bogged down with a home loan that isn’t the right fit for you can lead to greater financial stress, and make it harder to be where you want to be financially later in life. This is where refinancing comes in.

Why refinance?

You want to be able to change your home loan if circumstances change, either personally or economically. Having options available to you is financially liberating and reduces some of the stress naturally associated with finance. To make things clearer, talking to a mortgage broker like MPM Finance gets your options outlined, and affords you the opportunity to get into a home loan which is right for you.

Often, people will change lenders if their interest rates go up, or a “honeymoon rate” expires. No matter what the reason is, leaving a lender for a better deal is not uncommon, and in fact can be a strong financial move if there are better options around. While penalty clauses and discharge fees do exist in many home loans, paying these to switch to a different lender and a better rate may still put you in a better financial position down the track. Being sure of the comparison rate of a new loan gives you a good idea of the potential savings to be had against your current loan. Talking to a mortgage broker makes this process of switching lenders simpler, as they can help you look for the best deals to suit you.

Fixed vs Variable Rates

Another consideration to make in refinancing your home loan is the decision to take on a fixed or variable rate loan. Fixed rate loans are often taken out when the homeowner is concerned about potentially rising interest rates, and wants to lock down the same repayments for a fixed term (often 1-5 years). However it is important to note that while you won’t be affected by rate rises, you will also not benefit from drops in interest rates (which you would if you had a variable rate loan). Another benefit of refinancing with a variable rate loan is that usually you are able to make extra repayments at no extra cost, thus allowing you to save on total interest and pay off your loan sooner. Also, many variable rate loans offer unlimited redraws on extra repayments you make. However it is worth considering that the variable nature of interest rates can add extra stress to repayments if they do rise in time.

While there is a lot to understand and take on board when it comes to home loans and refinancing, getting in touch with finance experts MPM can make the whole process clearer and simpler for you. Being totally comfortable with a switch in lenders makes the entire refinancing process far easier, and can put you in good stead to reach your financial goals in the future.

To find out more about how MPM can help you, visit and book a free consultation.

written by:

Paul has over 35 years of experience in finding financial solutions for homebuyers, investors and business owners.
A licensed broker and member of the Mortgage & Finance Association of Australia (MFAA), Paul’s extensive experience includes 20 years with a major bank, seven of which were as commercial banking manager.
Paul delivers a holistic financial solutions to achieve the best possible outcome for a client’s personal or commercial lending needs. Paul also provides a comprehensive financial consultancy to business owners on commercial, equipment and invoice finance.

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