What’s involved with refinancing your home loan?

With the sudden increase in interest rates over the course of  2022 many people are now considering refinancing their home loan to ensure that they get the best possible deal for themselves and their families. At Ashfield Finance, we try to make this process as simple and easy as possible for our customers.

So what does this process look like for you the customer?

1. Initial meeting and discussion with a broker to discuss your requirements and objectives
2. Completion of our online fact find form
3. Completion of a house valuation (if required)
4. Meeting with a broker to review your refinance options
5. Selection of a product by you the customer
6. Gathering of supporting evidence by you the customer
7. Signing the application paperwork with your broker
8. Review of the application by the new lender
9. Signing the mortgage documents and discharge paperwork
10. Settlement of the home loan

Initial meeting and discussion with a broker to discuss your requirements and objectives

This is an overview meeting between yourself and one of our mortgage brokers. The broker will have lots of questions for you, but don’t worry if you don’t have all of the answers just yet, the types of questions you may be asked:

• How much is your home worth?
• How much do you owe on your current mortgage?
• What is your current interest rate?
• Do you want a fixed or variable rate loan?
• What is your current employment status / income?
• Do you have any other debts?

Completion of our online fact find form

At this stage we will send you a simple online fact find form to complete, this takes around 10-15 minutes to complete depending on the complexity of your situation.

This form inputs all of your information directly into our systems and allows us to quickly and easily gather all of the required data ready for us to use during product selection. There is often some overlap here between the information you provided during the initial discussion, but the form helps ensure that no data is lost in translation.

Completion of a free house valuation (if required)

Depending on the current market value of your home and the expected loan value ratio of your home (LVR) a formal valuation of your property may be arranged by your broker. These are generally free but can come with a small charged depending on the lender who is conducting the valuation. Any charges will be discussed and approved with you prior to been arranged.

Meeting with a broker to review your refinance options

During this meeting we will review all of the information provided in your fact find, the returned valuations and your requirements and objectives. Before presenting you with at least 3 options for your new home loan. This product comparison will contain all of the information surrounding your home loan including:

• The interest rate
• The expected monthly payment
• Application fees (if any)
• Ongoing fees (if any)
• Current product specials (including cashback offers)

We will also present you a comparison to your existing loan. This will illustrate on a monthly and on an full term of the loan basis how much you could save by switching lenders.

During this meeting your broker will also check your ID.

Selection of a product by you the customer

Once you have received our options and recommendation, its over to you to make a decision. There are no right and wrong answers here, with the lowest rate product not always been the best product for you – it could be missing some of your key features that are crucial to your home loan.

Gathering of supporting evidence by you the customer

This is the most painful step in the process and requires you to gather supporting evidence for your application. The exact documents required vary from lender to lender, your broker will provide a custom list depending on the lender selected. But will generally will include:

• Photo of your passport
• Photo of your driver’s licence
• Last 2 payslips
• Current statement for bank the account in which your salary is deposited into
• Your mortgage statement

Signing the application paperwork with your broker

Once all of the supporting evidence has been provided your broker will write up your loan and arrange a meeting for signatures of the application. There are a few forms to sign at this stage, and your broker will take you through each document to address any questions you may have prior to signature. The forms required to be signed are:

• Ashfield Finance – Credit guide
• Ashfield Finance – Privacy statement
• Ashfield Finance – Credit  proposal
• Lenders – Mortgage application
• Lenders – Privacy statement

Review of the application by the new lender

Your broker will then submit your application to your new lender. Each lender has different processing times for refinances with some applications been reviewed in a matter of hours, with others often taking weeks for the file to be reviewed.

Once reviewed the lender will hopefully formally approve the application. There are sometimes additional requests made at this stage which will be passed onto you via your broker. These are generally simple things such as supplying missing supporting evidence or confirmation of employment history.

Signing the mortgage documents and discharge paperwork

The lender will then send out the mortgage documents for you to sign and a copy of the discharge paperwork for the lender you are leaving. Its up you if you’d like your broker to help talk you through this paperwork before you sign it. Many of our customers do it alone or within the branch of the new lender, but if you’d like it we are more then happy to help.

Settlement of the home loan

Once all of the paperwork has been returned to the lender they will arrange settlement of the loan with your old lender. This process can take a few weeks to complete. During settlement a final calculation of the loan balances is completed, this doesn’t always match the original calculations due to the time passed between the application and settlement. Any funds over the agreed balance will b

Occasionally a shortfall can occur, when this happens additional funds would be required from you prior to settlement been completed. Your broker will discuss any shortfall with you and why it occurred prior to proceeding.

This sounds like a long and complicated process but Ashfield Finance will be there every step of the way to guide you through it and make it as seamless as possible