Mortgage Switching Calculator
So, you secured a home loan and purchased your own property? What do you expect next from your mortgage? Are you tied into your home loan deal for the next 25 years?
Despite your home loan term spanning 25 years or even 35 years, you are encouraged to switch deals every few years. This refreshes your home loan and allows you to take advantage of any new rates and attractive offers.
Knowing where to start when switching your mortgage can be tricky. However, Odin Mortgage has the perfect tools for you to use to find the best mortgage switching deal.
How Easy Is It to Switch My Mortgage?
Switching your mortgage is easy! Providing you have consistently paid your home loan repayments to date, lenders will be eager for you to switch your home loan to them.
Alternatively, you can stay with your current mortgage provider instead of switching mortgage lenders. Simply switch your mortgage deal with the same mortgage lender.
How effortless it is to switch your home loan deal will depend on the terms of your current deal. You may have exit charges to pay to release you from a mortgage deal sooner than intended.
Fixed Rate Mortgage Deals
If your home loan is a fixed deal, it may be fixed between 1 to 5 years. A typical timescale to fix your mortgage deal is 2 years, however. During this time, your interest rate stays the same and your monthly repayment amount never changes.
If you want to switch home loan deals when you have a fixed home loan deal, what should you do? It is recommended to wait until your fixed deal has almost expired. Fixed mortgages have an exit fee applicable if you want to be able to switch deals before the term has ended.
This may cost you several thousand dollars and so it is better to wait and switch deals when the fixed rate period has ended. At this point, there will be no exit fee to pay.
Variable Rate Mortgage Deals
When switching mortgage providers deals on a variable rate mortgage deal, there are no fees to pay. Your existing mortgage deal is set on variable rates and you are free to switch mortgage providers or deals whenever you like.
A mortgage with variable rates will possess a fluctuating interest rate. Your monthly mortgage repayments may rise and fall, depending on varying factors such as the RBA cash rate. Mortgage payments are difficult to budget for when you are on a variable interest rate deal.
However, you do have the flexibility to switch mortgage providers or stay with the same mortgage provider on a different deal.
Split Rate Mortgage Deal
When applying for your mortgage loan, your mortgage advisor may have mentioned a split rate mortgage deal, but what is it?
A split rate takes advantage of fixed rate deals and variable rate deals. A portion of your home loan is assigned to a fixed rate, receiving constant monthly repayments that you can budget for.
The remaining portion of the split rate loan is assigned a variable interest rate. This portion of your home loan can face fluctuating monthly repayments yet is flexible.
If you have a split rate loan, the fixed rate portion of your loan may be tied up with an exit fee and an early repayment charge. Some lenders may allow you to switch your deals for your variable rate, however.
Is It Worth Switching My Mortgage?
Switching mortgages can mean that you save money and provide cheaper mortgage interest rates. Your new mortgage provider may offer attractive incentives so why not take advantage?
Remember to do your homework, however. Find out what your ongoing interest rate will be and how long you are tied into the deal if you have chosen a fixed interest rate. Will the interest rate change, and are there any fees involved?
However, just because a new mortgage deal looks great, does not mean that it will save you money. How can you find out if your new mortgage rate is worth it?
Why Would You Switch Your Mortgage?
The predominant reason why you may want to switch deals includes that your fixed deal is coming to an end. You will need to accept a new deal from your current provider or switch to a new mortgage lender.
You may want to switch to a new mortgage on a variable rate deal if you have seen a deal with a low-interest rate. You will not have an exit charge to forfeit and so switching makes perfect financial sense!
Another reason for switching is if you want to overpay on your mortgage. Many mortgages will not let you pay more than a set amount of extra payments each year. Paying more money off your mortgage may result in an early repayment charge being set.
Switching to a variable rate mortgage makes sense as you will be able to pay as much as you like to reduce the amount you owe. Early repayment charges are not applicable in a variable rate home loan.
Additionally, how much equity is in your home? If your home equity has increased substantially over the years, your loan-to-value ratio will have decreased. This may call for a better mortgage term and competitive mortgage rates becoming available due to a change in your financial circumstances and credit rating.
Other homeowners decide to switch deals so they can unlock some equity and release cash in their homes. Perhaps you want to place a deposit down on a buy-to-let mortgage, or you may want to extend your home? Switching to a different mortgage offer could help you to do this!
How Can I Compare Mortgage Deals Before Switching?
Use Odin Mortgage’s Mortgage Switching calculator now and compare new loan details with your existing mortgage rate.
This expert tool will highlight your monthly repayments, interest, and fees for your existing deal and the new deal. Introductory rates and relevant fees are included, demonstrating whether switching would be better for you.
To use the Mortgage Switching calculator, follow these simple instructions:
- Enter the details for your current home loan, entering the loan amount, interest rate and loan term duration.
- Also enter your repayment frequency and whether any regular fees and end fees are applicable.
- Next, choose the new loan deal that you would like to switch to. Enter the introductory rate and term, the standard interest rate, and any regular and upfront fees.
- Review your results and see how much you will pay monthly with each deal. You will also see the amount of interest and fees payable under each deal, and the savings to be made.
Furthermore, the Mortgage Switching calculator shows you the outcome of three different scenarios.
Scenario 1 involves staying with your current mortgage deal and not switching. Scenario 2 involves switching to a new deal and paying minimum repayments. Scenario 3 takes into account switching and paying higher monthly repayments.
You can tailor the scenarios to meet different approaches, finding out which method would save you money. Comparing deals places you in control and makes perfect financial sense!
What Should I Do to Switch My Mortgage Deal?
The easiest way to switch your mortgage deal and compare mortgages is to let Odin Mortgage take care of everything for you! Our experts will listen to your needs and what you are hoping to gain from your mortgage options.
We will search for competitive rates and present you with the best home loan deals available, helping you switch smoothly!
Contact Odin Mortgage to Switch Your Mortgage Today!
To switch your mortgage deal, get in touch with Odin Mortgage! Complete the online form or email email@example.com. We will get back to you at your convenience, ensuring that you receive expert advice and guidance to switch your mortgage.
For more information about Odin Mortgage, visit our FAQs and extensive range of resources. We are experts in Australian mortgages for Expats and foreign nationals, and charge you zero fees to use our service! Get in touch with Odin Mortgage to switch your mortgage now!
Frequently Asked Questions
Can I switch mortgage deals whenever I want to?
If you are on a variable home loan deal then you can switch whenever you like. There should be zero fees for you to pay to do this.
However, if you are on a fixed interest rate mortgage, you will need to wait until the loan term is over before being able to switch. Switching prematurely may result in an exit fee being charged.
Can I change my mortgage provider?
You can change your mortgage provider when you switch to a different deal. Perhaps you are unhappy with the service your lender provides? We will look for your great new deal with a different mortgage provider so you can switch today! Check out our competitive rates available today!
Will I need to pay fees to switch mortgage deals?
As long as there are no exit fees to pay, your current lender will not charge you any fees to switch deals. However, some new lenders may charge you a fee upfront and even an ongoing fee. These fees should be assessed when comparing new loan deals before switching.
Other mortgage brokers may also charge you a fee if they help you to switch mortgage deals. Here at Odin Mortgage, we charge you zero fees! We take our fee from the lender you select for your new home loan deal. Read the questions you need to ask a mortgage broker now!