Application fees, stamp duties, discharge fees and mortgage insurance are just some of the costs you need to understand as you refinance.
Refinance almost always costs you money at the start - normally more than $1000 and often more than $3000. You will pay for:
1. Mortgage insurance, usually payable when you borrow more than 80 per cent of the value of your property.
Mortgage insurance will often cost more than one per cent of your property value.
And it doesn't insure you - it insures lenders against the risk that your may not be able to repay your loan.
2. Application, documentation, settlement and handling fees, charged by most lenders. These can reach $800.
3. Early repayment fees, often charged if you repay your loan before it was due to finish. These vary widely according to lender.
4. Valuation fees still charged by some lenders. These have often reached $200.
5. Discharge fees on your existing mortgage (around $50-$200).
6. Registration fees on your new mortgage (around $50-$100).
In some circumstances, state governments will charge stamp duty on your new mortgage .
This will add around $50-$100 to your refinance bill in Victoria, NSW, Tasmania, WA and SA.
Many borrowers pay an invisible cost for refinancing - the extra interest which they pay for taking longer to pay off their loan.
For most people, most of the time, the cheapest loan is the one you pay off fastest.
Please contact the lending professionals at APO Finance to discuss all your loan requirements.
Call 07 3387 2200 or
Contact Us by clicking here.
