Essential Questions to Ask Your Lender When Refinancing Your Mortgage

I you're thinking about refinancing your mortgage, it is crucial to arm yourself with the right information before diving in. The key to a successful refinance is asking the right questions and understanding the answers.

When it comes to refinancing your mortgage, it's crucial to consult with a mortgage professional. They have the expertise to guide you through the process and can provide valuable insights into the current market trends. They can also help you understand the different types of refinances and their benefits and drawbacks.

If you haven't found a mortgage broker yet, I would suggest you take a look at my list of the best mortgage brokers in Sydney. I have worked with dozens of mortgage brokers, and Principal Mortgages is my #1 recommendation. Not only do they have decades of combined experience, but they have extremely friendly and supportive staff that will guide you through the entire process. If this is your first time refinancing, you won't have to worry at all. The team at Principal Mortgages will ensure that everything is explained in a simple manner, and will answer any questions you have.

Key Questions to Ask Your Lender

When discussing refinancing with your lender, there are several key questions you should ask, which I have listed here:

  • What is the interest rate, and is it fixed or variable?
  • If it's a fixed rate, how long is it fixed for?
  • What fees are involved (including annual fees, early-repayment fees, exit fees, etc)?
  •  What is the term of the loan?
  • What features are available on the loan (eg: offset account, redraw facility, credit card)?
  • What is the maximum LVR (loan to value ratio)?
  • What are the monthly repayments? 
  • What will the monthly repayments be if the interest rate goes up by 0.25%, 0.5%, 0.75%, 1.0%? This ensures you are prepared for how much you could be paying if the lender increases the interest rate.

These are some main questions to keep in mind, but remember that you may have more questions that are specific to your situation.

Preparing for the Refinancing Process

Refinancing your mortgage requires some preparation. One of the key things to understand is that you'll need to cover closing costs. These can include application fees, loan origination fees, appraisal fees, and more. It's important to factor these costs into your decision to refinance.

There are also options to cover refinancing costs. Some lenders offer "no-cost" refinances, where they agree to cover the closing costs in exchange for a slightly higher interest rate. It's important to carefully consider this option and calculate whether the higher interest rate will cost more over the life of the loan than the closing costs would have.

Remember, lenders will check your credit score and history when you apply for a refinance. It's a good idea to check your credit report before applying to ensure there are no errors that could negatively impact your application.

Choosing Your Lender and Refinance Product

When it comes to choosing a lender for your refinance, you have options. You can choose to refinance with your existing lender, which may offer certain benefits like a streamlined application process. Alternatively, you could choose a new lender who may offer a more competitive interest rate or better terms. 

It's important to compare mortgage lenders and the types of refinance products they offer. Different lenders may offer different interest rates, terms, and fees, so it's worth shopping around to find the best deal. A top mortgage broker will help you save time and energy, as they shop around for the best deals; they also tend to get better rates as they have the power to bring in large numbers of mortgages for the lenders.

When choosing a refinance method, consider your goals. Are you looking to lower your monthly payments, pay off your mortgage faster, or tap into your home's equity? The answer will help guide your choice of refinance product.


Refinancing your mortgage is a big decision, and it's important to ask the right questions and understand all your options. By consulting with mortgage professionals, preparing for the refinancing process, and carefully considering your lender and refinance product options, you can make an informed decision that aligns with your personal and financial goals.

Remember, the goal of refinancing is not just to get a lower interest rate, but to help you achieve your broader financial goals. Whether that's paying off your mortgage faster, lowering your monthly payments, or tapping into your home's equity, the right refinance product can help you get there. So take your time, do your research, and make the decision that's right for you.

About the author 

Harold Simmons

Harold is the founder and creator of the Asset Owners Discussion Project. He creates quality resources so investors can get access to information they wouldn't normally be able to access. He has been investing in real estate for almost three decades and is particularly experienced with mortgages and refinancing.

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