Refinance calculator
Compare your current home loan with a new rate to see the monthly saving, how long it takes to recover switching costs, and the interest saved.
Rates last checked . See how we calculate.
You could save
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- Current monthly repayment
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- New monthly repayment
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- Costs paid back in
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- Interest saved over the loan
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Assumes the same remaining term and that both rates stay the same for the life of the loan.
Quick answer: moving a $600,000 loan with 25 years left from 6.75% to 6.10% cuts repayments by about $243 a month. With $1,000 in switching costs you are ahead after 5 months, and you save about $71,900 in interest over the remaining term.
What a lower rate is worth
| Rate cut | Monthly saving | Break-even | Interest saved |
|---|---|---|---|
| 0.25 percentage points | $94 | 11 months | $27,268 |
| 0.50 percentage points | $187 | 6 months | $55,236 |
| 1.00 percentage point | $371 | 3 months | $110,249 |
How the calculator works
- It works out your current monthly repayment from your balance, rate and remaining term, using the same formula as our mortgage repayment calculator.
- It works out the repayment on the same balance and term at the new rate.
- The difference is your monthly saving. Switching costs minus any cashback, divided by the monthly saving, gives the number of months to break even.
- Interest saved compares total interest on both loans over the remaining term, less your net switching costs.
Watch out for resetting the loan term
When you refinance, a new lender may set the loan back to 30 years. That lowers repayments a lot, but you pay interest for longer. In our example, refinancing to 6.10% over a fresh 30 years drops the repayment to $3,636 a month, a $510 monthly saving. Yet total interest rises by about $65,300 compared with staying on 6.75% for 25 years. To capture the real saving, keep the remaining term or keep paying your old repayment amount. You can model the effect of paying more with the extra repayment calculator.
Costs to include
- Discharge fee from your current lender, typically a few hundred dollars
- Government registration fees to discharge the old mortgage and register the new one
- Application, valuation or settlement fees from the new lender, often waived
- Break costs if you are leaving a fixed rate early. These can run to thousands, so ask your lender for a quote first.
- LMI if you owe more than 80% of the property's value, because LMI does not transfer between lenders. Estimate it with the LMI calculator.
Is it worth refinancing in 2026?
With the cash rate at 4.60% after four rises this year, the gap between the average rate existing borrowers pay and the sharpest new-customer rates is often worth checking. Ask your current lender for a better rate first. Many will match a competitor to keep you, which saves the switching costs entirely. Compare current offers on homeloaninterestrates.au.
Frequently asked questions
How much does it cost to refinance a home loan?
Often $500 to $1,500 for discharge, registration and settlement fees, before any cashback. Break costs on a fixed loan or new LMI can add much more.
How much of a rate cut makes refinancing worthwhile?
Even 0.25 percentage points saves about $94 a month on $600,000 and repays $1,000 of costs in under a year. The bigger your balance and the longer you have left, the more a small cut is worth.
Does refinancing hurt my credit score?
A loan application leaves an enquiry on your credit file, which can lower your score slightly for a while. Several applications in a short time have a bigger effect, so compare first and apply once.
Can I refinance if my property value has fallen?
Yes, but if your loan is now more than 80% of the value you may need to pay LMI again, which can wipe out the saving.
Should I take a cashback offer?
Only if the rate is also competitive. A $3,000 cashback is outweighed within about 2.5 years by a rate just 0.2 points higher on a $600,000 loan.
Sources
- Reserve Bank of Australia, cash rate decisions 2026
- ASIC Moneysmart, switching home loans
- Our calculation methods