How to Refinance Your Home Loan

If you’re considering refinancing, you are not alone. Rising interest rates, changing loan terms, and fluctuations in income, especially for self-employed borrowers, have prompted many Australians to explore smarter loan options.

Refinancing can help you reduce repayments, consolidate debt, access equity for renovations or business purposes, or switch to a loan that better suits your circumstances.

This guide is tailored for homeowners who are self-employed, tradies, or small business operators.

Why Homeowners Are Exploring Refinancing

Many borrowers are reassessing their mortgages due to changing market conditions.

A few key insights:

• Property prices have shown long-term growth in many areas, supported by population growth and infrastructure investment (CoreLogic Market Trends, 2024)
• Coastal, regional, and metropolitan areas continue to attract families and self-employed workers seeking lifestyle and affordability (ABS Population and Migration Data, 2023)
• Interest rate changes between 2022 and 2024 encouraged many homeowners to review their loan structure (RBA Cash Rate Data)

Refinancing is not just about chasing a lower interest rate. It may also improve cash flow, reduce financial stress, and make a home loan better suited to your situation.

What Does Refinancing Mean?

Refinancing is the process of replacing your existing mortgage with a new one, either with your current home loan provider or a different option.

Homeowners may refinance to:

• Lower monthly repayments
• Access equity
• Switch from variable to fixed rates or vice versa
• Consolidate personal or business debt
• Adjust loan features such as offset accounts, redraw facilities, or repayment frequency
• Improve cashflow when income changes

For self-employed borrowers, refinancing may also allow the use of alternative documentation when traditional tax returns do not reflect actual income.

Steps to Refinance Your Home Loan

Refinancing does not have to be complicated. Here is a clear process:

1. Understand Your Current Loan

Review:

• Your current interest rate
• Remaining loan term
• Break or discharge fees
• Loan features you are or are not using

This will help you compare refinancing options more effectively.

2. Check Your Equity and Property Value

Your home’s value plays a key role in refinancing. Having more equity can provide greater opportunities and improve the options available to you.

3. Organise Your Financial Documents

For self-employed borrowers, specialists may review:

• Business bank statements
• BAS statements
• Profit and loss summaries
• Accountant declarations
• Personal bank statements

Full tax returns are not always required if you use refinancing options designed for self-employed applicants.

4. Compare Refinancing Options

When exploring refinancing, consider options that account for:

• Self-employed income
• Seasonal or fluctuating earnings
• Business expenses that reduce taxable income
• Mixed PAYG and business income streams

The goal is not only a potentially lower interest rate but also a home loan better suited to your circumstances.

5. Submit Your Application

Once your documents are prepared, a refinancing application is lodged and assessed. This process is often faster than applying for a first home loan.

6. Switch Your Loan

If approved, your new loan pays out your existing mortgage. You then begin repayments under the new structure, which may give more flexibility and comfort.

Benefits of Refinancing for Self-Employed Homeowners

Self-employed borrowers may feel overlooked by traditional home loan options, which often rely heavily on standard documentation. Working with a specialist may open up solutions tailored to your situation.

Refinancing can help self-employed homeowners to:

• Improve cashflow
• Reduce total interest paid over time
• Smooth business-related expenses
• Access equity for tools, equipment, or renovations

It is a useful financial strategy for small business owners, contractors, and tradies.

Want Help Refinancing Your Home Loan?

If you are self-employed or own a business and want to explore refinancing, Rate Money can assist.

We specialise in self-employed home loans and can help structure refinancing so you have a better chance of approval.

Explore refinancing options here:
https://ratemoney.com.au/existing-loan-refinancing

References

1. CoreLogic – Housing Market Updates & trends https://www.corelogic.com.au
2. Reserve Bank of Australia (RBA) – Cash Rate and interest rate announcements https://www.rba.gov.au
3. ABS Census & Population Data https://www.abs.gov.au