6 mistakes to avoid when refinancing your home loan

By Gabriella Margerison · · 2 min read
Fact Checked
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With what seems like an endless amount of RBA rate rises, it’s little wonder more Aussies than ever are choosing to refinance their mortgages for a better deal. But when making the educated decision to change lenders, there are a few things borrowers should consider before making the switch.

While it’s true; refinancing can be a great way to save money on repayments and reduce the overall cost over the life of your loan, there are still common mistakes borrowers make when navigating the home loan market. So if you think you’re ready to refinance, consider these 6 things, before signing on the dotted line.


  1. Focusing only on the interest rate
    While it can be great shopping around for the lowest rate, borrowers often overlook other important aspects like loan features that could save them even more. For instance, benefits like having an offset account or the ability to make unlimited repayments could be your ticket to paying off your mortgage sooner.
  2. Sticking with the same lender
    Many borrowers who refinance will often ask their existing lender for a better deal, when in fact, shopping around could very well score you a better rate. Being loyal to your bank doesn’t always mean you’re getting the best deal and the process is the same whether you stick to your existing lender or go to a new one. So you could very well be doing yourself a disservice by not exploring your options.
  3. Ignoring the comparison rate
    Borrowers will often only look at the main headline interest rate which represents the annual interest rate, when refinancing their home loan. A better approach is to look at the comparison rate as this is a true representation of what you’ll be paying when you factor things like on-going fees and charges you may incur.
  4. Starting another 30 year loan term
    While it can be tempting to extend your mortgage to 25 or 30 years to reduce repayments, it means that all the progress you have made will have you back to square one if you choose a long loan term. Take advantage of a lower interest rate to pay your mortgage down, so it doesn’t drag on more than it has to.
  5. Using too much of your equity
    If you’ve had your home loan for some time, you have probably accumulated equity or value in your home. Many borrowers use their equity to renovate or make a big purchase, but doing so could be a mistake in the current climate with rising interest rates and the possible decline in home values, so tread with caution.
  6. Choosing the wrong time to refinance
    Time is of the essence, but finding the right time to refinance is key. If for instance you are locked into a fixed loan rate, you’ll want to wait until your fixed term has ended before refinancing as you may incur ‘break-cost’ fees that you weren’t expecting.
    

Ready to refinance your home loan? Check out some top refinance deals below or why not see who made the Mozo Experts Choice Awards for Home Loans winners list in 2023.^

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Last updated 5 December 2025 Important disclosures and comparison rate warning*
What are your home loan needs?
Loan purpose
Buying or Refinancing
  • Promoted

    Unloan Variable Home Loan

    • Owner occupier
    • Principal & Interest
    • 20% min deposit
    • Redraw available
    Interest rate
    5.19 % p.a.
    Variable
    Comparison rate
    5.10 % p.a.
    Initial monthly repayment
    $2,742
    Go to site
    • The first home loan with an automatic loyalty discount (conditions apply)
    • No application or banking fees
    • Built by CommBank

  • Fixed Rate Home Loan

    • Fixed rate
    • Owner occupier
    • Principal & Interest
    • 5% min deposit
    Interest rate
    5.09 % p.a.
    Fixed 2 years
    Comparison rate
    5.43 % p.a.
    Initial monthly repayment
    $2,712
    Go to site
    • No ongoing annual fees
    • Make up to $25,000 extra repayments during a fixed period, fee free (T&Cs apply)
    • Lock in for up to 5 years.

  • Unloan Variable Home Loan

    • Owner occupier
    • Principal & Interest
    • 20% min deposit
    • Redraw available
    Interest rate
    5.19 % p.a.
    Variable
    Comparison rate
    5.10 % p.a.
    Initial monthly repayment
    $2,742
    Go to site
    • The first home loan with an automatic loyalty discount (conditions apply)
    • No application or banking fees
    • Built by CommBank

  • Discount Great Rate Home Loan

    • Owner occupier
    • Principal & Interest
    • 20% min deposit
    • Redraw available
    • Cashback
    Interest rate
    5.19 % p.a.
    Variable
    Comparison rate
    5.20 % p.a.
    Initial monthly repayment
    $2,742
    Go to site
    • Get up to $3,000 cashback when you apply online (T&Cs apply)
    • No paperwork or payslips required (see site for details)
    • Low variable rate

  • Variable Home Loan 90

    • Owner occupier
    • Principal & Interest
    • 10% min deposit
    • Offset available
    • Redraw available
    Interest rate
    5.29 % p.a.
    Variable
    Comparison rate
    5.33 % p.a.
    Initial monthly repayment
    $2,773
    Go to site
    • No monthly or ongoing fees
    • Option to add an offset for 0.10% p.a.

  • Offset Home Loan

    • Owner occupier
    • Principal & Interest
    • 40% min deposit
    • Offset available
    • Redraw available
    Interest rate
    5.39 % p.a.
    Variable
    Comparison rate
    5.42 % p.a.
    Initial monthly repayment
    $2,805
    Go to site
    • No ongoing monthly loan maintenance fees to pay.
    • Pre-approval valid for 3 months
Showing 5 results from 380 home loans. Use the filters to see more

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* WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for $150,000 over 25 years.

** Initial monthly repayment figures are estimates only, based on the advertised rate. You can change the loan amount and term in the input boxes at the top of this table. Rates, fees and charges and therefore the total cost of the loan may vary depending on your loan amount, loan term, and credit history. Actual repayments will depend on your individual circumstances and interest rate changes.

^See information about the Mozo Experts Choice Home Loan Awards

Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.

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