Refinancing Expat Home Loans: A Guide for Expiring Fixed Rates in 2024

In 2020 and 2021, the onset of the COVID-19 pandemic saw the Reserve Bank of Australia (RBA) set interest rates at a record low, i.e. as low as 0.1%. It was one of the causes of an unusual rise in the popularity of fixed-rate home loans in Australia.

Many Australian borrowers, including Aussie expats, locked their rates for three years or less. Two-thirds of those borrowers completed their fixed terms in 2023, according to Aussie and CoreLogic.

In 2023, most of those fixed rates expired and reverted to the banks’ higher standard variable rates. This resulted in increased monthly repayments for many borrowers.

Now in 2024, another wave of fixed rate mortgages from 2021 is set to expire. If your fixed rate is ending in 2024, here’s what you need to know.

Is Your Fixed Rate Expat Mortgage in Australia Expiring?

Some of the interest rates secured on fixed rates during the onset of the pandemic were as low as 1.95% for three years or less. When these fixed-rate mortgages expire, they will revert to the bank’s standard variable rate. Is your fixed rate home loan term expiring in 2024? This will likely increase your monthly repayments.

How Will This Affect Me as a Borrower Living Outside Australia?

Australian expats on variable rates may already be familiar with the increased interest rates in Australia. However, the sudden rise in interest rates may come as a shock for many Aussie expat homeowners who are still paying low fixed interest rates for their homes.

Fixed-rate expat borrowers will find themselves paying 3 to 4% more than they currently pay when their fixed term expires. Further, the higher interest rate may negatively impact unprepared borrowers.

Refinancing home loans: a guide for expiring fixed rates in 2023

Consider Refinancing Your Fixed Rates for Your Expat Home Loan

The current Australian homeownership landscape in 2024 continues to see higher interest rates and rent costs. Such increased rates may be difficult for some borrowers to adjust to financially.

Refinancing your expat home loan provides better control over your expiring rates by changing the current terms and interest rates of your expat home loan. You can also take this opportunity to look elsewhere for the most competitive rates in Australia.

Refinancing once your fixed rate term expires avoids break costs that lenders may charge for refinancing before the fixed term ends.

We recommend that you consider every aspect of your home loan rather than solely focusing on interest rates, especially if you are an expat. A specialist expat mortgage broker can analyse your needs and recommend suitable solutions and lenders.

Contact us today to speak with one of our expat mortgage brokers for tailored recommendations and suggestions to help you consider the most suitable refinancing option from the right lenders.

Get a free Australian mortgage assessment today.

Apply online to get a free recommendation with real rates and repayments.

Frequently Asked Questions

When your fixed interest rate term ends, you will usually be moved to a higher variable rate. Refinancing lets you lock in a new competitive fixed rate and potentially lower your monthly repayments.

The process is similar to getting your initial home loan. Your broker will help you find better deals and submit paperwork. You may need to provide updated income proofs and transfer funds internationally.

Start looking at refinance options 3-6 months beforehand. This gives you time to compare rates and go through the process without being rushed before your term expires.

There can be financial penalties for breaking your fixed rate ahead of expiry. Your broker will help you time it right to avoid fees.

Generally, refinancing alone does not impact your visa or residency. Consult your mortgage broker and immigration expert to be sure of any potential issues.

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