Before refinancing, it’s important to review whether the long-term savings you’ll gain will outweigh the upfront costs.

To make life just that little bit easier for you, here’s a handy guide that will go through the common fees and charges to expect when refinancing, and also a Q&A with home loan specialist Heidi Armstrong.

Costs of refinancing a home loan

There are numerous upfront fees and costs to look out for when refinancing a home loan. While the costs of these different fees can vary depending on the lender, below are some of the standard upfront refinancing fees you may need to account for.

Break fees

If you have a fixed-rate home loan and you’re looking to refinance during the fixed-rate period, you will most likely incur a break fee

These fees cover any loss of profit the lender may have sustained due to the incompletion of the agreed fixed term. 

Although break costs are quite difficult to calculate, they typically depend on three factors:

  1. The loan amount
  2. The length of time remaining on the fixed term
  3. The fixed rate compared to the current variable market rate

Early exit fees

When a borrower ends the loan or refinances to another lender, they are charged an early exit fee.

The Gillard Government banned lenders from charging early exit fees on loans taken out after 1 July 2011. So, if you have borrowed your loan prior to this, you may be required to pay an exit fee. 

The costs for this type of fee can range anywhere between $0 to $7,000. It is recommended to contact your current lender to discuss whether exit fees may apply to you.

Application/establishment fees

If you’re refinancing with another lender, they may charge you an application fee which can range from $0 to $1,000. In some cases, lenders will negotiate or even waive the fee in order to compete for your business. 

The fee is essentially a one-off payment that covers the cost of processing and documenting the new mortgage. 

Property valuation fees

A new lender may request a valuation be done of your property to get a picture of your equity

The valuation fee is dependent on the lender and also the location of the property. For instance, rural properties tend to have higher valuation fees than those in urban areas due to practical factors e.g. travel time.

As a rough guide, a valuation can cost as little as $50 and as much as $775. Some lenders may even include the valuation cost in the application fee.

Settlement fees

If you can’t tell by the name, a settlement fee is paid to a new lender to settle the loan. It covers the cost of the lender arranging for a legal representative to attend the loan alongside the buyer and their conveyancer or solicitor

On average, settlement fees cost between $100 and $400.

Discharge fees

Also referred to as a termination fee, a mortgage discharge fee applies to external refinances and is where the lender may ask you to pay discharge fees to cover the admin fees required to end the contract. 

On average, mortgage discharge fees are around $200-$400 but can be as high as $1,000.

Mortgage registration fees

A mortgage registration fee is charged by the state and territory governments to register the property as the security on a home loan. In other words, it gives the lender the right to sell the property if the buyer doesn’t pay them back.

A mortgage registration fee can cost between $100 to $200 depending on your location.

Here are the current refinancing loan rates in the market

Update resultsUpdate
LenderHome LoanInterest Rate Comparison Rate* Monthly Repayment Repayment type Rate Type Offset Redraw Ongoing Fees Upfront Fees LVR Lump Sum Repayment Additional Repayments Split Loan Option TagsFeaturesLinkCompare
6.04% p.a.
6.06% p.a.
$2,408
Principal & Interest
Variable
$0
$530
70%
Featured Online ExclusiveUp to $4k cashback
  • Immediate cashback upon settlement
  • $2000 for loans up to $700,000
  • $4000 for loans over $700,000
5.99% p.a.
5.90% p.a.
$2,396
Principal & Interest
Variable
$0
$0
80%
  • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
5.94% p.a.
5.95% p.a.
$2,383
Principal & Interest
Variable
$0
$0
90%
5.99% p.a.
5.99% p.a.
$2,396
Principal & Interest
Variable
$0
$150
60%
6.04% p.a.
6.06% p.a.
$2,408
Principal & Interest
Variable
$0
$530
90%
4.5 STAR CUSTOMER RATINGS
  • Low rates for purchase and refinancing
  • Simple online application process
  • No fees, unlimited redraws, 0.10% offset 
6.14% p.a.
6.17% p.a.
$2,434
Principal & Interest
Variable
$0
$445
60%
6.04% p.a.
7.15% p.a.
$2,013
Interest-only
Fixed
$0
$180
90%
6.09% p.a.
6.11% p.a.
$2,421
Principal & Interest
Variable
$0
$250
60%
6.09% p.a.
6.35% p.a.
$2,421
Principal & Interest
Fixed
$6
$799
80%
6.14% p.a.
6.15% p.a.
$2,434
Principal & Interest
Variable
$0
$0
80%
6.19% p.a.
6.44% p.a.
$2,447
Principal & Interest
Variable
$248
$350
80%
  • $0 application fee
  • Fast turnaround times
  • Estimate your borrowing power in as little as 1 minute
6.30% p.a.
6.58% p.a.
$2,476
Principal & Interest
Variable
$0
$791
95%
6.59% p.a.
7.36% p.a.
$2,552
Principal & Interest
Fixed
$8
$0
70%
6.74% p.a.
7.37% p.a.
$2,592
Principal & Interest
Fixed
$0
$160
90%
6.84% p.a.
7.16% p.a.
$2,726
Principal & Interest
Variable
$0
$0
95%
More home loans
Important Information and Comparison Rate Warning

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. Some products will be marked as promoted, featured or sponsored and may appear prominently in the tables regardless of their attributes. All products will list the LVR with the product and rate which are clearly published on the product provider’s website. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of .

First published 01 Feb 2011, last updated by Hanan Dervisevic 05 July, 2022