Home loans · Refinancing
Refinance calculator
What a lower rate saves you each month, and how soon the saving pays back the cost of switching.
Arithmetic checked · rates are yours The rates and fees are the ones you enter: no official schedule sets them.
Your tally
Monthly saving
$235.86
Switching costs won back in 5 months; every month after that is saving.
How it’s worked out
Same remaining term on both sides — the saving comes from the rate, not from stretching the loan.
Variable-to-variable comparison. Breaking a fixed rate adds break costs — ask your lender for the exact figure. Equity under 20% may mean paying LMI again at the new bank.
A lower rate is the biggest free kick in home lending — if the switching costs don't eat it. This refinance calculator shows the monthly saving, the break-even point, and the honest comparison over the same remaining term.
Watch the term-reset trick.
Refinancing 25 remaining years into a fresh 30-year loan makes the new repayment look brilliantly low — because you'd be paying for five extra years. Lifetime interest goes up even at a lower rate. This calculator holds the term constant so the rate's real value is visible; stretch the term only if you consciously want the cash flow and accept the cost.
What a rate cut is worth
On a $550,000 balance with 25 years remaining, from 6.4%, after $1,000 switching costs:
| Rate cut | New rate | Monthly saving | 5-year cash-flow saving |
|---|---|---|---|
| −0.25% | 6.15% | $85.09 | $4,105 |
| −0.50% | 5.90% | $169.24 | $9,154 |
| −0.75% | 5.65% | $252.42 | $14,145 |
| −1.00% | 5.40% | $334.64 | $19,078 |
Same tested engine as the calculator. Even a quarter-percent pays back $1,000 of switching costs in about 12 months on a balance this size.
The switching-cost checklist
- Discharge fee — the old lender's charge for closing the loan. It is set by your loan contract, so ask for the figure.
- Government fees — your state's land registry charges to discharge the old mortgage and to register the new one. Registration alone is $129.20 (Victoria) to $248.04 (Queensland) in FY 2026–27; the conveyancing fees page lists every state’s.
- New-lender fees — application, settlement or valuation fees, whatever the new lender charges. Ask which it will waive.
- Fixed-rate break costs — only if you're leaving a fixed loan early; can be enormous when rates have fallen since you fixed. Get the payout figure in writing first.
- LMI, again — if your equity is under 20%, the new lender charges its own lenders mortgage insurance; the premium you already paid doesn't transfer. This alone can sink an otherwise good switch.
Before you switch for a better rate, it's worth one phone call: ask your current lender's retention team to match it. If they do, there are no switching costs at all.
Break-even, done properly
The arithmetic is one line — switching costs divided by monthly saving. On the example above, $1,000 of costs against $235.86 a month breaks even in about 5 months; every month after that is pure saving. But the line misleads in three situations. If you're likely to sell within the break-even window, the switch never pays for itself. If you're on a fixed rate, the break cost belongs in the costs figure — and it can turn seven months into seven years. And if your equity is under 20%, a fresh LMI premium at the new lender is a switching cost too, and it can be the biggest one on the list. Feed the real numbers into the calculator above and let the break-even speak for itself.
Cash-back offers, priced against the rate
A cash-back is a one-off payment; a rate difference is paid every month. Here's the comparison that matters: on a $550,000 balance, a rate just 0.20% lower is worth $68.15 a month — so a $3,000 cash-back beats the sharper rate only for about 44 months, and after that the lower rate wins every month, forever. Cash-backs suit people who genuinely re-shop every couple of years; if you're likely to set and forget, take the rate. And if your lender now charges you more than it offers new customers, that gap is exactly what the retention-team phone call is for.
Frequently asked questions
What does it cost to refinance a home loan?
When is refinancing worth it?
Why does this calculator keep my term the same?
Does refinancing hurt my credit score?
Can I refinance if my equity is under 20%?
What about cashback offers?
Keep tallying
Assumptions
Standard amortisation maths, monthly compounding, constant rates, and the same remaining term on both loans; switching costs paid upfront. The engine is covered by automated accuracy tests — see the methodology. General information only — not financial or credit advice.