Refinancing your mortgage has advantages beyond just lowering your monthly mortgage by hundreds of dollars. You can take a major step towards attaining long-term financial goals by making the correct decisions and working with a mortgage broker. There are a number of benefits that can come from replacing your old mortgage with a new one, here are our top six:  

1.) Reduced interest rate and lower monthly payments. You can put the interest savings into an offset account to further reduce your interest bill or make extra loan repayments to reduce your principal balance. This also means that your LVR will be much lower than before you refinanced. 

2.) Reduction in the whole loan amount can make you pay off the loan faster and maximise your equity level. You can lower the entire amount of your current loan balance by refinancing to a loan with a sharper interest rate, instantly lowering your overall interest expense. You can release equity faster by paying the new interest rate. This can also maximise your return on investment (ROI) if you plan to sell your property.

3.) Get potential tax benefits. You might be able to benefit from negative gearing via depreciation advantages. If you refinance to access the equity in your house then utilise that money to further invest in real estate or other assets. We recommend speaking with a professional in order to identify your tax deductions correctly. 

4.) Refinancing to grow your business. You can access available equity by requesting an additional loan, such as a top-up. You might use refinancing to help you grow your business when you plan to introduce new product lines, new stock acquisitions or hire more employees. Refinancing can also be used as a term extension to ensure that the term is set for a longer period of time which can allow the business to carry on.

5.) Consolidate high-interest debt into a low-interest home loan. You can refinance to combine your debt payments into a single and less expensive payment each month. Save thousands of dollars and pay off your debts more quickly. You can consolidate your payments with high interest including credit cards, personal loans, car loans, and ATO debts.

6.) Save your home if your mortgage is in arrears. Major life events like an accident, illness, job loss, or the passing of a loved one might make it difficult for you to keep your financial obligations. If a mortgage is in arrears, refinancing is a worthy solution that can save people from losing their homes. 

Consult a Mortgage Broker to learn more about home loan products and features available to you by refinancing.

At Micah Finance Solutions, we can guide you on refinancing and which home loan products and structures would work with your situation. Speak with our Mortgage Broker today and schedule an obligation-free consultation.