Refinancing your home loan in Australia: costs, steps and when it adds up (2026)

What refinancing is

Refinancing is replacing your current home loan with a new one. Most people do it with a different lender, but Moneysmart also describes refinancing internally: staying with your current lender and switching to a different loan, which can come with a switching fee¹.

Moneysmart's first step is to ask your current lender for a better deal before you leave. It says that if you tell your lender you plan to switch to a cheaper loan elsewhere, the lender may reduce the rate on your current loan to keep your business, and that having at least 20% equity in your home gives you more to bargain with¹.

Rates have been moving. The Reserve Bank raised the cash rate target four times in 2026, in February, March, May and September, taking it to 4.60% from 30 September 2026¹⁰.

What it costs to refinance

Moneysmart lists these fees and charges to compare before you switch¹:

Good to know: Moneysmart's worked example compares two loans with application fees of $600 and $300¹. No official source publishes a typical discharge, application or break fee, so FIZO does not quote one. Each lender sets its own, and they appear in the loan's Key Facts Sheet and contract.

Exit fees, break fees and discharge fees are not the same thing

Since 1 July 2011, the National Credit Regulations have prohibited early termination fees on residential loans, subject to some exceptions⁸. ASIC's guidance says the ban does not apply to a break fee or a discharge fee⁸. So a home loan taken out since then can still charge a discharge fee when you close it, and a break fee if you leave a fixed rate early.

Moneysmart lists "are there break costs if I repay the loan early or refinance?" among the questions to ask a lender or broker, because the Key Facts Sheet does not cover every condition³.

Government fees to register and discharge a mortgage, by state

When you refinance to a new lender, the old lender's mortgage is removed from your title (a discharge) and the new lender's mortgage is registered. Each state and territory land titles office charges a fee for each. These are the 2026-27 fees published by each office, for a standard lodgement on one title.

Good to know: Queensland's 2026-27 fee schedule has no line named mortgage or discharge. Its general fee to register "any other instrument" is $248.04, and Titles Queensland directs people to its online fee calculator for the exact fee¹³. The NSW fee includes a $5.35 Torrens Assurance Fund levy¹¹, the SA fee includes a $15.00 transaction fee¹⁵, WA fees are not subject to GST¹⁴, and the NT says other fees may apply when lodging online¹⁸.

The steps to refinance

In Moneysmart's worked example, a couple whose fixed rate was about to end compared two loans and chose the one with the higher application fee because its lower rate offset it. Moneysmart says they save $84,040 ($280 a month) over the life of their 25-year loan and recover the switching costs in five months¹. That is one example, not a typical result.

1. Ask your current lender for a better deal. Moneysmart says your lender may cut your rate to keep your business¹.
2. Check your equity and LMI. With less than 20% equity you might have to pay LMI again, which can outweigh the savings. If you switch, Moneysmart suggests asking for a refund of some of the LMI on your current loan¹.
3. Get the Key Facts Sheet for each loan. Moneysmart suggests comparing loans from at least two different lenders, using a Key Facts Sheet based on the amount you are likely to borrow³.
4. Add up the fees. Break, discharge, application and switching fees, plus any stamp duty and the government mortgage fees¹.
5. Keep the loan term similar. Moneysmart warns you could end up with a longer term than the years left on your current mortgage, and the longer the loan, the more interest you pay¹.
6. Run the numbers. Moneysmart's mortgage switching calculator works out whether you will save money and how long it will take to recover the cost of switching².

The comparison rate and the Key Facts Sheet

A comparison rate includes the interest rate and most fees and charges relating to a loan, reduced to a single percentage figure⁴. The Key Facts Sheet gives a personalised comparison rate for the amount you plan to borrow³.

Moneysmart says the Key Facts Sheet is compulsory, and the layout is the same for every home loan across every lender, so you can compare like for like. You can generally get one from a mortgage broker, from the lender, or from the lender's website³. It also lists establishment fees and ongoing fees (also called service or administration fees)³.

Moneysmart notes that even a rate 0.2% lower could save thousands of dollars over time, and suggests working out what your repayments would be if rates rose by 3%³.

• Are there break costs if I repay the loan early or refinance?³
• What happens when a fixed or introductory interest rate ends?³

Cashback offers

Some lenders have offered a cash payment to borrowers who refinance to them. The Reserve Bank's May 2026 review of bank fees describes the continued withdrawal of cashback deals for new and refinancing mortgage borrowers⁹.

A cashback is a one-off amount, while the interest rate and fees apply for the life of the loan. The Key Facts Sheet and Moneysmart's switching calculator compare the ongoing cost²³.

Good to know: No official source publishes current cashback amounts, so FIZO does not quote one. Moneysmart points out that comparison websites are businesses that may make money through promoted links and may not cover all your options¹.

What a mortgage broker does

A mortgage broker deals with banks and other lenders to arrange a home loan. Moneysmart says mortgage brokers must act in your best interests when suggesting a loan for you⁶. That duty has applied since 1 January 2021, when ASIC's best interests obligations for mortgage brokers took effect⁷.

According to Moneysmart, a broker can work out what you can afford to borrow, find loan options, explain each loan and its costs, and help you apply and manage the process through to settlement⁶. The broker should present more than one option and explain why it is in your best interests⁶.

Lenders generally pay brokers a commission, a percentage of the loan amount with both an upfront and ongoing payment, so you do not pay them directly. Brokers must tell you about the commissions they may receive. If a broker charges you a fee, you must sign a written quote first⁶. For more, read how mortgage brokers are paid.

Moneysmart suggests checking a broker's licence on ASIC's Professional Registers Search, under the Credit Representative and Credit Licensee lists⁶. FIZO checks the mortgage brokers it lists against ASIC's registers and shows a verified badge on each one that matches.

Moneysmart's free tools

• Mortgage switching calculator: whether you will save money by switching, and how long it will take to recover the cost².
• Choosing a home loan: how to compare Key Facts Sheets, and the questions they do not answer³.
• Using a mortgage broker: questions to ask and how to check a broker's licence⁶.