Refinance hub

Refinance playground — break-even, term reset & loyalty tax

Why are you refinancing?

Refinance playground

Your refinance savings

Enter your loan — see monthly and lifetime interest upside, then book a review or email your PDF plan.

Your refinance upside

You could save $193/mo by refinancing at this rate — $11,601 over the next five years.

That is $51,042 less interest over your remaining term vs staying put. I will shortlist lenders and lodge term-for-term on your file.

Get my lender shortlist

Monthly saving

$193/mo

Term-for-term at your new rate

5-year saving

$11,601

Illustrative — not a quote

Interest saved

$51,042

vs staying on current rate

Your plan

75% complete

Numbers
Compare
Decision
Send

Try a preset

What this means for you

Save $193 per month
Save $11,601 over 5 years
Break even after 19 months
Could reduce interest by $51,042
Potentially pay off your loan earlier with the same repayment

Your refinance opportunity score

92fit score

Excellent refinance opportunity

Based on your rate gap, monthly saving, break-even timing, and lifetime interest upside. Illustration only — not a credit decision.

Your monthly saving

$193/mo

Five-year upside: $11,601. Lifetime interest saved: $51,042.

Market rate band

Indicative new-customer band on your balance: 5.85% – 6.20% ($95 – $225/mo). Not an offer — illustration only.

Scenario	Monthly	Total interest
Current loan	$4,118	$507,036
Refinance at new rate	$3,924	$455,994

Comparison

Hover or tap a bar to highlight — amounts shown on the right and in the callout below.

Interest saved vs current loan: $51,042 (10.1% less)

Total interest — current loan$507,036

Total interest — after refinance$455,994

Cumulative savings (60 months)

If the monthly difference stayed steady, saved cash flow stacks roughly along this slope — before tax, offset use, or price changes.

≈ $12k cumulative over 60 months (illustrative)

Refinance score

Excellent refinance opportunity

Your loan inputs

Loan basics

Current loan balance

Current rate (% p.a.)

New rate (% p.a.)

Loan term

Years remaining on your loan

Illustration only — not a quote or credit assessment. Book a refinance review when you want lender shortlist and lodgement on your file.

How this hub works

Enter your balance, current rate, and a sharper refinance rate. The playground shows your monthly saving, five-year upside, and lifetime interest saved — then email a PDF plan or book a review with Bishnu.

Refinance home loan guide Apply pathway

Also: break-even calculator · usable equity calculator · self-employed refinance · refinance articles · comparison rate vs interest rate · term-reset trap

By Bishnu Adhikari · ACR 538895, auth. under ACL 390261 · Playground outputs are educational estimates only.

Fixed rate expiry season

Fixed rate ending? Model break-even before you auto-revert

Revert rates are often higher than retention offers — compare term-for-term savings, switching costs, and the term reset trap before your fixed period ends.

Open refinance playground

20-second quiz

What's your refinance type?

Four quick questions — then jump straight into the calculator.

Question 1 of 4

What matters most right now?

Example · $580k · 6.45%→5.89% term-for-term

$193/mo saved on this example

Enter your balance and rates in the playground below. When the saving looks meaningful, book a refinance review with Bishnu — I shortlist lenders and lodge term-for-term on your file.

Term reset trap

Are you about to make a six-figure refinance mistake?

A lower monthly repayment feels like a win — but resetting to a fresh 30-year loan can add massive lifetime interest. Compare match your remaining term vs extend the term.

Results update live as you type.

Loan balance

Current rate (% p.a.)

New refinance rate (% p.a.)

Years left on your loan

Match my remaining termRefinance on the same 22-year schedule — the fair comparison. Uncheck to model a lender resetting you to a longer term.

New loan term if lender resets (years)

Common trap: 22 years left → rolled into 30 years.

Live trap cost

+$242,755

30 yr reset vs 22 yr match · looks $589/mo cheaper on repayments

Match term total interest: $550,337 (current: $611,940 @ 6.45%)

The reset trap

+$242,755 extra interest

Resetting to 30 years instead of keeping 22 years saves $589/mo on paper — but costs $242,755 more in total interest than a term-for-term refinance.

Your loan now

$4,969/mo

22 yrs · 6.45% · $611,940 total interest

Match term — 22 yrs @ 5.89%

$4,736/mo

22 yrs · 5.89% · $550,337 total interest

Reset term — 30 yrs @ 5.89%

$4,147/mo

30 yrs · 5.89% · $793,092 total interest

Looks $589/mo cheaper — but +$242,755 interest vs match term

Comparison

Hover or tap a bar to highlight — amounts shown on the right and in the callout below.

Total interest — match 22 yrs$550,337

Total interest — reset 30 yrs$793,092

Before you sign

Ask your broker for pricing on your actual remaining term.
Compare total interest — not just the monthly repayment.
Switching costs are not included here — model those in the full playground below.

Full refinance playground Free review — 0400 77 77 55

Illustration only — standard P&I amortisation, nominal rates. Not a quote or credit assessment. Read the term reset trap guide.

Equity release

How much equity could you access?

Illustration only — not a valuation, pre-approval, or credit assessment.

Property value

Current loan balance

Desired LVR (%)

Current equity: $330,000
Current LVR: 61.2%
Accessible equity: $160,000
Max loan at target LVR: $680,000
Investment deposit (illustrative): $152,000
Renovation budget (illustrative): $152,000
Debt consolidation (illustrative): $152,000

Worked examples — same maths as the playground

Illustrative scenarios computed with the same engine as the playground above — not lender quotes. Round figures for readability; your loan will differ.

Loan	Rates	Scenario	Monthly saving	Break-even	Reset trap cost
$580,000	6.45% → 5.89%	Term-for-term, $3.5k costs	~$193	~19 mo	+$201k if reset to 30yr
$720,000	6.8% → 6.1%	Fixed expiring, $4k costs	~$288	~14 mo	+$383k if reset to 30yr
$458,000	6.2% → 5.75%	+ $8k debt rolled in, $5.5k costsBalance assumes $450k mortgage plus $8k personal debt consolidated — higher LVR may affect lender choice.	~$126	~44 mo	+$98k if reset to 30yr
$600,000	6.55% → 5.95%	Investor IO rolling to P&I, $3.5k costsInvestor serviceability and tax treatment differ — playground models repayment maths only.	~$230	~16 mo	+$54k if reset to 30yr

General information only — not personal credit advice. Fixed-rate break costs, cashback clawbacks, and comparison rates are not modelled unless noted. Confirm term-for-term pricing with your lender or broker before signing.

Your loan story

Balance, interest & time

Year 0of 30

Balance

$580,000

Interest paid so far

0% of repayments to date

Principal paid

$3,647/mo P&I est.

General information only. These calculators provide estimates based on the numbers you enter. They do not constitute credit advice, take your full situation into account, or replace a lender's assessment. Fees, eligibility, and actual offers vary. Speak with a broker for guidance tailored to you.

Quick check

Am I paying too much?

Enter your loan balance and current rate for an indicative saving band — lighter than a full refinance model. Not a quote; book a review when you want retention vs external lenders checked on your file.

Loan balance

Current interest rate (% p.a.)

Indicative saving band

$98 – $233/mo

Rate band (illustration): 5.85% – 6.20%
Repayment could land around: $3,540 – $3,675/mo

Five checks before you refinance

Read the supporting article for each check, then test the numbers on your own loan in the playground.

Break-even
Include discharge fee, new application fee, and valuation in switching costs. If monthly saving is $180 and costs are $3,500, break-even is roughly 20 months — model yours in the playground.
Five signs you should refinance →
Term-for-term
Ask your broker to price a refinance that keeps your remaining term (e.g. 22 years), not a fresh 30-year loan. That preserves interest saved from years already paid down.
The term reset trap explained →
Term reset trap
A lower monthly repayment from resetting to 30 years can add $80k–$200k+ in lifetime interest on a typical Australian loan — even at a better rate.
Why reset pricing costs six figures →
Loyalty tax
Most existing borrowers pay 0.3%–0.6% above new-customer pricing. A retention call before switching sometimes beats moving lenders — but only if they match properly on a term-for-term basis.
Home loan loyalty tax guide →
Fixed break costs
This playground does not model fixed-rate break fees. If you are on a fixed loan, confirm break costs with your lender before counting refinance savings.
Fixed vs variable — break cost context →

Articles and tools to read alongside

Plain-English explainers on switching costs, retention calls, and product fit. General information only.

Why homeowners use this hub

Australia-wide service
Multiple lender options
Free refinance review
No obligation assessment

General information only — not personal financial or credit advice. Azure Home Loans — ACR 538895, auth. under ACL 390261 (Yellow Brick Road).

Embed for partners

Accountants and finfluencers can drop the refinance savings playground on their site. The iframe loads a chrome-free view; UTM parameters attribute traffic back to your channel.

Partner slug (utm_source)

Embed code

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<p style="font-size:12px;color:#64748b;margin-top:8px;">
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Preview the embed at /refinance-playground/embed.

Common refinance questions

Quick answers for homeowners arriving from social media or search — general information only.

What is refinancing?

Refinancing means replacing your existing home loan with a new one — often with a different lender or rate. Homeowners refinance to get a lower rate, access equity, consolidate debt, or change loan features. You still need to qualify for the new loan and pay switching costs such as discharge and application fees.

Should I refinance?

Refinancing can make sense when term-for-term savings exceed switching costs within your planned hold period, your rate is above new-customer pricing, or you need equity or debt consolidation. It may not suit you if break-even is too long, fixed break costs are high, or a retention offer already matches market pricing. Use the playground for illustration — confirm with a broker before lodging.

Can I access equity when I refinance?

Yes — many refinances include a cash-out or equity release component. Lenders cap loan-to-value ratio (often 80% without LMI). You need sufficient equity, serviceability, and a clear purpose. The equity calculator on this page shows illustrative accessible equity — not a valuation or approval.

Can I refinance to consolidate debt?

Yes. Rolling credit cards or personal loans into your home loan can lower the unsecured rate and simplify repayments. The trade-off is longer-term mortgage debt secured against your property. Model the new balance and term-for-term repayment before consolidating.

How long does refinancing take?

Straightforward refinances often take four to eight weeks from application to settlement — faster with a complete file, longer if valuations, employment checks, or discharge delays occur. Fixed-rate exits needing break-cost quotes add time.

Will refinancing affect my credit score?

A refinance application usually involves a credit check, which can cause a small short-term dip. Multiple applications in a short period may affect your score more. One well-prepared application with documents ready is better than several incomplete enquiries.

Refinance FAQs — break-even & term reset

Break-even, term-for-term vs reset, switching costs, retention vs external lenders, and when refinancing is not worth it — short answers for Australian borrowers.

What is break-even when refinancing a home loan in Australia?

Break-even is how many months of term-for-term monthly savings it takes to recover your switching costs — discharge fee, new application or valuation fee, and government charges. If you save $193 a month and switching costs are $3,500, break-even is roughly 19 months in modelled examples. After that point, each month of savings is ahead of what you paid to switch. The refinance playground models break-even from your balance, rates, remaining term, and costs — illustrative only, not a loan quote.

What is term-for-term refinancing vs resetting to 30 years?

Term-for-term keeps your remaining amortising term (for example 22 years left) at the new lower rate — so interest saved reflects years already paid down. Resetting to a fresh 30-year term cuts the minimum monthly repayment but can add six figures in lifetime interest even at a better rate. Always ask for term-for-term pricing in writing and compare total interest, not just the monthly figure. The playground shows both paths side by side.

What switching costs should I include when refinancing?

Typical switching costs include your current lender discharge fee, the new lender application or establishment fee, valuation fee, and state government mortgage registration or discharge charges. Do not count cashback as a negative cost until you understand clawback rules. Fixed-rate break costs are separate — this playground does not model them. ASIC Moneysmart publishes a refinancing checklist; use realistic totals in the cost slider before trusting break-even.

Is a retention discount better than switching lenders?

Sometimes. A retention call that genuinely matches new-customer pricing on your remaining term can avoid discharge fees and valuation — but many retention offers reset the term or leave you above market. Compare the retention rate term-for-term against an external lender quote including all switching costs. The loyalty-tax band in the playground shows indicative savings if your rate moved toward new-customer pricing — not an offer.

How are fixed-rate break costs calculated in Australia?

Fixed-rate break costs compensate the lender for lost interest when you exit before the fixed period ends. Methods vary — often based on the difference between your fixed rate and current wholesale or swap rates, multiplied by the remaining fixed term and loan balance. Some lenders publish calculators; others only quote on request. Never count refinance savings until you have a written break-cost figure from your lender. This hub does not model fixed break fees.

Does the comparison rate matter when refinancing?

Yes — but it is not the rate you pay each month. The comparison rate includes interest plus most fees and charges expressed as an annual percentage, using a standard loan amount and term. It helps compare products with different fee structures but can hide cashback clawbacks, offset benefits, or break costs. Read the comparison rate alongside the actual interest rate and your switching-cost break-even in the playground.

When is a cashback refinance offer a trap?

Cashback can work when the term-for-term rate is competitive, switching costs are covered, and clawback periods have passed before you refinance again. It is a trap when the headline rate is worse than retention or another lender, the loan resets to 30 years, or you must stay several years to keep the cashback — paying thousands back if you switch early. Model term-for-term savings net of costs before chasing cashback marketing.

How long does refinancing take in Australia?

Straightforward refinances between major lenders often take four to eight weeks from application to settlement — sometimes faster with a complete file, longer if valuations, employment checks, or discharge delays occur. Fixed-rate exits needing break-cost quotes add time. Self-employed files with recent tax returns may take longer. Lodge when your documents, break costs, and term-for-term quotes are ready rather than rushing on a rate headline alone.

Can I refinance with less than 20% equity?

Often yes, subject to lender policy, loan-to-value ratio caps, and mortgage insurance rules. Many refinances sit in the 80% to 90% LVR range; above 80% LVR you may pay lenders mortgage insurance again unless your existing policy is portable (uncommon). Low equity can also limit how many lenders will price your file. A broker can scan the panel for LVR-friendly products — the playground models repayment maths, not LVR eligibility.

What changes with a debt consolidation refinance?

Rolling personal debt into your home loan lowers the unsecured rate but converts short-term debt into long-term mortgage debt secured against your property. Your loan balance rises, switching costs may be higher, and total interest can grow if you only pay the new minimum. Break-even must include any fees to discharge personal loans. Model the new balance and term-for-term repayment in the playground before consolidating.

Is self-employed refinance maths different?

The repayment and break-even maths are the same once you know balance, rate, and term — but proving serviceability is harder. Lenders typically want two years of tax returns or accountant-prepared figures, and may shade income more conservatively than PAYG employment. Allow extra time for document collection. After you have an indicative rate, use the playground for break-even and term-reset comparisons the same way as a PAYG borrower.

When is refinancing not worth it?

Refinancing may not be worth it when the rate gap is tiny, switching costs push break-even beyond your planned hold period, you are mid-fixed with large break fees, retention already matches external pricing on a term-for-term basis, or a 30-year reset would erase interest savings. It can also fail serviceability or LVR tests. If monthly saving is zero or negative at term-for-term pricing, the playground flags that before you lodge.

What is the home loan loyalty tax?

The loyalty tax is the gap between what many existing borrowers pay and what the same lender advertises to new customers — often around 0.3% to 0.6%. On a $580,000 loan, 0.5% can cost roughly $3,000 a year in extra interest. A retention call or external refinance can close the gap if priced term-for-term. The playground shows an indicative band — not a live quote.

How accurate is the refinance playground?

It is a mathematical model from the inputs you enter: balance, current and new rates, remaining term, reset term, and switching costs. It does not include fixed break costs, cashback clawbacks, comparison-rate fees, offset accounts, or lender-specific package discounts. Use it to orient break-even and term-reset risk — confirm all figures with your lender or broker before signing.

How do I download the free refinance plan PDF?

Enter your email on the refinance playground results panel after modelling your scenario. The PDF summarises term-for-term monthly saving, break-even timing, term-reset trap cost, and the loyalty-tax band you modelled. It is a planning aid, not a credit assessment or loan approval. Adjust inputs and request an updated summary anytime.

Should I refinance before my fixed rate expires?

Compare three numbers: your current fixed rate until expiry, the revert or variable rate afterward, and external term-for-term quotes — plus any break cost to exit early. Sometimes waiting until expiry avoids break fees; sometimes the revert rate is high enough that breaking early still wins after costs. Model both paths and speak with your broker before paying break costs.

How does the fixed-rate break cost estimate work in the playground?

The optional fixed-rate module uses a simplified formula: max(0, (your fixed rate − variable benchmark) × balance × months left ÷ 12) with a conservative 0.85 factor. Real lenders use swap rates and contract wording — always request a written break-cost quote before switching off a fixed loan.

How should I model cashback refinance offers?

Enter the cashback amount to reduce upfront switching costs in break-even. If you plan to refinance again within the clawback window (often 24–36 months), the playground warns you and grosses costs back up for adjusted break-even. Net cashback only counts if you stay long enough to keep it.

What does “keep paying current repayment” show after a refinance?

If you refinance term-for-term to a lower rate but continue paying your old monthly amount, more goes to principal each month — shortening the loan and saving extra interest versus paying only the new minimum. This bridges the refinance hub with pay-off-faster strategies; it does not model offset or lender caps.

Latest from Insights

Recent articles on refinance timing, rate strategy, and lender switching.

External reference

Government & regulator links

Third-party sites for cross-checking — not lender marketing. Azure Home Loans is not affiliated with these agencies.

Moneysmart · ASIC
Home loans — Moneysmart (opens in new tab)
ASIC-backed guides on comparing loans, fees, features, and working with brokers.
Open official site →
Moneysmart · ASIC
Switching home loans (opens in new tab)
Step-by-step on discharge, comparison rates, break costs, and what to ask before you switch.
Open official site →
Moneysmart · ASIC
Mortgage calculator (opens in new tab)
Independent repayment and budget illustrations — useful sanity-check before you lodge.
Open official site →
Moneysmart · ASIC
Problems paying your mortgage (opens in new tab)
Hardship rights, talking to your lender, and free financial counselling pathways.
Open official site →
AFCA
Disputes with a lender (AFCA) (opens in new tab)
External dispute resolution if you cannot resolve a complaint with your credit provider.
Open official site →

Important information

General information only — not personal credit advice. Calculators and articles on this hub provide illustrations based on the inputs you enter. They do not model fixed-rate break costs, cashback clawbacks, comparison rates, or lender-specific fees unless noted.

Confirm term-for-term pricing in writing before you sign refinance documents. A lower monthly repayment from resetting to 30 years can add substantial lifetime interest even at a better rate — always ask your broker or lender to price your remaining term.

Cross-check with ASIC Moneysmart — refinancing. When the numbers look meaningful, send a short enquiry for a 15-minute rate review.