As a Tasmanian government employee, you're in a unique position when it comes to refinancing your home loan. Your stable employment and regular income can open doors to loan options from banks and lenders across Australia that might not be available to everyone else.
Let's walk through what you need to know about the refinancing approval process and how it could benefit your financial situation.
Why Consider Refinancing Your Home Loan?
There are several compelling reasons why you might want to refinance:
• Accessing a lower interest rate - If rates have dropped since you first took out your loan
• Reduce loan repayments - Lower rates or extending your loan term can decrease monthly payments
• Consolidate debts - Combine multiple debts into your home loan at a lower rate
• Release equity to buy the next property - Use your home's increased value for investment opportunities
• Releasing equity in your property - Access funds for renovations or other major expenses
• Change your loan term - Shorten or extend your repayment period to suit your current needs
Many Tasmanian government employees find themselves considering refinancing when their fixed rate period ending approaches, or when they want to explore whether there are loan options available that suit their changing circumstances.
Understanding the Refinancing Approval Process
The application process for refinancing involves several key steps that lenders use to assess your suitability for a new loan.
Income Verification
As a government employee, your regular salary works in your favour. Lenders will review your payslips and employment details to confirm your income stability. Your secure position in the public service is often viewed favourably by lenders.
Financial Documentation
You'll need to provide recent banks statements, typically covering the last three months. These help lenders understand your spending patterns and financial habits. They'll also want to see details about your current loan amount and any other debts you might have.
Property Valuation
Lenders will assess your property's current value to determine how much equity you have available. This is particularly important if you're looking to release equity or change your loan amount.
Credit Assessment
Your credit history will be reviewed to ensure you've maintained good repayment habits on existing loans and credit cards.
Fixed vs Variable Interest Rates
When refinancing, you'll need to choose between a fixed interest rate and a variable interest rate, or sometimes a combination of both.
Variable Interest Rate
• Rates can move up or down with market conditions
• Often offer more flexibility with extra payments
• May provide access to offset accounts or redraw facilities
Fixed Interest Rate
• Provides certainty with locked-in repayments
• Protects against rate rises during the fixed period
• Less flexibility for extra payments during the fixed term
Special Benefits for Government Employees
As a Tasmanian government employee, you may be able to check eligibility for special lender policies that aren't available to the general public. These can include:
• Discounted refinance interest rates
• Reduced fees or waived establishment costs
• More flexible lending criteria
• Streamlined application process
Public Home Loans specialises in understanding these unique benefits available to public service employees and can help you access loan options that maximise your advantages.
Conducting Your Home Loan Health Check
Regular home loan health check reviews can reveal opportunities you might not have considered. This involves:
- Comparing your current interest rate with what's available in the market
- Reviewing your loan features against your current needs
- Assessing whether you could potentially access a lower interest rate
- Examining if there are loan options that offer additional benefits
Your circumstances may have changed since you first took out your loan, and what suited you then might not be the most suitable option now.
Making Your Decision
When weighing up whether to refinance, consider factors beyond just the interest rate. Look at:
• Total fees involved in switching
• Loan features that matter to you
• The lender's customer service reputation
• How the new loan aligns with your long-term financial goals
Refinancing isn't always the right choice for everyone, but for many Tasmanian government employees, it can lead to significant savings or provide access to funds for other financial goals.
As specialists in working with public service employees, we understand the unique advantages your employment provides and how to leverage these when seeking refinancing approval.
Call one of our team or book an appointment at a time that works for you to discuss your refinancing options and discover what opportunities might be available for your specific situation.
