Andrew Malcolm here, Mortgagehq.
And today we're going to talk about why people transfer their mortgage
from one bank to another bank.
Now, this is often called refinancing,
and it's triggered through what is usually strong secondary goals.
People want to either restructure their mortgage to lengthen the loan term,
which might mean 17 year mortgage goes to say 24
year mortgage and that helps lower your repayment.
Might be,
you know, want to shorten your mortgage so from, say, 28 years, down to 18 years.
That's obviously going to increase the repayments.
It's going to incur a bit of time and effort on restructure.
So people start to think, Well, if I'm going to spend all this time
and effort into restructuring,
maybe I want to shop around and see if I can get a better deal.
When we, as mortgage advisers are looking to help people
transfer their mortgage or refinance, just assess the options.
We're looking for any debt that might make sense to consolidate.
We're looking to assess if there's any top ups or renovations wanted.
Maybe you want to buy a car, go on holiday,
you want to access some of your home equity for that side of things.
Banks are going to look at your applications and your situations
in different ways.
So your current bank might not be super helpful.
Another bank might be happy to help.
If you're looking at investment property.
This is often a trigger for some people to consider
transferring mortgages to other banks.
Banks in particular at the moment are looking at rent in different ways.
They're looking at borrowing power in significantly different ways
from each other.
Where you might be able to borrow $400,000 from your current bank
for another property.
This other bank might through restructure and through assessing your situation
in a different way, might allow you to buy an $800,000 dollar property.
So it's a very strong incentive to consider switching and transferring banks
if one will allow you to buy the property you want and the other one won't.
If you are looking to help kids into property
or get help from your parents.
That sometimes can trigger a transfer
from one bank to another, where there's more favorable terms or
a solution at your bank.
And in particular, it's really good to assess banking products.
Some banks offer offset products, that's a really awesome thing
to consider if you have built up savings or a lot of money
that's not really being put to work.
Not all banks offer that.
So assessing the banking products that you'd like access to,
sometimes that would trigger you to maybe consider transferring bank.
Everyone wants.
They always want the best deal or things held constant if you're going to get lower
rates, if you're going to get a cash back incentive,
if you're going to get rewards on credit cards or fees waived.
Everybody wants to know about that.
And sometimes that can contribute to triggering you
to transfer your mortgage from one bank to another.
The thing I want you to keep in mind as we close off is,
a mortgage adviser that's impartial, that can assess your options
across all the banks and the scope
of what knowledge of products and options that all the banks
is going to have far more insight into what you can and should do
versus the banker that you're dealing with that only really understands
what they can offer at their bank - and is very limited.
So the person you're talking to at
the bank will have a lot of knowledge that's deep just about their bank.
But they they can't necessarily give you the advice of what's best for you,
because what's best for
you might be to consider switching banks to get that debt consolidation done.
Switching banks to get that bank product that's not offered at their bank,
but it is at the other one.
It might be that switching banks is, you know, five to ten
grand of benefit that the banker can't recommend that.
So it's good to assess if you can get what you want to get doneat your current bank
because it might be simple, it might be quick.
But if you've got a couple of weeks up your sleeve
and you want to get financially the best outcome for yourself.
It does make sense to consider whether you should transfer
your mortgage or refinance and make sure you get everything
spreadsheeted' all out by a mortgage adviser, that everything you understand
so that even if there's say, for example, a legal cost
triggered from one bank to another, you know you're refinancing,
there's going to be a legal costs associated with that.
Just understand that the benefit that you're getting financially
and even if it's not a financial benefit, just understand the benefits vs cost.
Because transferring your mortgage is not necessarily free.
If you like this video about refinancing or transferring a mortgage.
Don't be afraid to ask questions in the comments and hit subscribe.
Will love to answer more questions about refinancing and about your specific needs.