If your current rate sits above what lenders are offering new borrowers, refinancing could cut your repayments by hundreds of dollars each month.
You work irregular hours, and the last thing you need is a drawn-out loan process that requires you to be available during business hours. The question is whether the rate reduction justifies the time and cost involved, and how to manage the process around your roster.
How much you actually save by switching lenders
The difference between a rate of 6.2% and 5.8% on a $500,000 loan is roughly $120 per month, or $1,440 per year. Over five years, that compounds to over $7,000 in interest savings, assuming rates remain stable. That calculation changes if you owe more or less, or if the rate gap is wider.
Most lenders waive application fees when you refinance your home loan, but you still need to account for discharge fees from your current lender, which typically sit between $300 and $400. If you are on a fixed rate, break costs can run into thousands depending on how much time remains and how much rates have moved since you locked in. You need the numbers in front of you before you commit.
Why your rate climbed while advertised rates dropped
Lenders adjust their advertised rates to attract new customers, but existing borrowers stay on whatever rate they signed up for unless they ask to switch. Your lender has no obligation to move you to a lower rate automatically. In our experience, existing customers on older variable products can sit 0.3% to 0.8% above what the same lender offers new applicants.
If you have been on the same loan for more than two years and have not negotiated, there is a reasonable chance you are paying more than you need to. Call your current lender first and ask what rate they can offer if you threaten to leave. If they drop it to match or beat what you have found elsewhere, you avoid the cost and effort of switching. If they will not move, that tells you where you stand.
Fixed or variable after you refinance
Variable rates let you make extra repayments without penalty and adjust if the market drops further. Fixed rates lock in certainty but charge break costs if you pay out early or sell before the term ends. Detectives moving between units or regions may need flexibility, particularly if a transfer or sale is possible within the next few years.
Consider a detective who refinanced to a three-year fixed rate at 5.5%, then received a transfer interstate eighteen months later. The break cost to exit that loan early was $4,200, which wiped out most of the savings from the lower rate. A variable loan would have let them repay without penalty. If your role involves potential moves, a variable rate or a shorter fixed term reduces that risk.
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How shift work affects refinance approval
Lenders assess your income using payslips, tax returns, and employment contracts. If your base salary is consistent but you work rotating shifts with penalty rates, some lenders will include 100% of that shift loading in their assessment, while others will average it or exclude it entirely. The lender you are with now may not be the one that gives you the strongest borrowing position when you refinance to a new lender.
You need a lender that understands how law enforcement income is structured. A broker familiar with police and detective pay can submit your application to lenders who treat shift penalties and allowances as ongoing income, not casual overtime. That can mean the difference between approval and rejection, or between borrowing enough to consolidate debt and falling short.
What documents you need and how to get them between shifts
Most refinance applications require your last two payslips, two years of tax returns, and recent statements for all accounts. If you hold investment properties or have other debts, lenders will ask for those statements as well. You also need a rates notice or contract of sale for the property you are refinancing.
Lenders now accept documents uploaded through secure portals, which means you can submit everything outside business hours. If you are missing a document, most brokers can request it directly from your employer or the ATO on your behalf using authority forms you sign digitally. The process does not require you to take time off or make calls during the day.
When refinancing does not make sense
If you owe less than $150,000 or plan to sell within the next twelve months, the cost of refinancing often outweighs the interest savings. Discharge fees, valuation costs, and settlement fees add up quickly on smaller loan balances, and you need enough time in the new loan to recover those upfront costs.
If you are on a fixed rate with more than two years remaining and break costs exceed $3,000, calculate whether the monthly saving covers that cost within a reasonable period. A $100 per month saving takes two and a half years to recover a $3,000 break cost. If you might sell or pay down the loan aggressively in that time, you could end up worse off.
How long the process takes and what happens at settlement
From application to settlement, most refinances take three to five weeks. Lenders order a valuation within the first few days, assess your income and credit within a week, and issue formal approval shortly after. Settlement is usually scheduled two to three weeks from approval, depending on how quickly your current lender processes the discharge.
You do not need to attend settlement in person. Your new lender pays out your old loan, and the discharge is registered automatically. Your first repayment on the new loan is typically due four to six weeks after settlement, which gives you a brief gap between your last payment on the old loan and the first payment on the new one.
Refinancing gives you a chance to restructure debt
If you are carrying a car loan at 8% or credit card debt at 12% to 18%, you can roll that into your home loan at a much lower rate during the refinance. A $20,000 car loan at 8% costs roughly $400 per month over five years. The same $20,000 added to a home loan at 5.8% costs about $120 per month, though it extends the repayment period unless you make extra payments.
This works if you are disciplined about paying down the consolidated debt quickly. If you let it sit for the life of the loan, you end up paying more interest overall despite the lower rate. Speak to someone who can show you the numbers based on what you owe and what you can afford to repay each month. A debt consolidation strategy only works if the repayment plan is realistic.
Refinancing is not urgent, but if your rate sits well above the market and you plan to stay in the property for at least another two years, the case for switching is strong. Call one of our team or book an appointment at a time that works for you, including after hours or on your days off. We will run the comparison, check your eligibility, and handle the process around your roster.
Frequently Asked Questions
How much can I save by refinancing to a lower rate?
A rate drop of 0.4% on a $500,000 loan saves roughly $120 per month, or $1,440 per year. The actual saving depends on your loan balance and the rate difference between your current loan and what you can access.
Do I need to take time off work to refinance?
No. Most lenders accept documents uploaded through secure portals, and brokers can request payslips or tax returns on your behalf using signed authority forms. Settlement happens automatically without you needing to attend in person.
What fees do I pay when refinancing?
You will typically pay a discharge fee of $300 to $400 to your current lender. If you are on a fixed rate, break costs may apply depending on how much time remains and how rates have moved since you locked in.
Should I fix or go variable after refinancing?
Variable rates offer flexibility for extra repayments and no break costs if you sell or transfer. Fixed rates lock in certainty but charge penalties for early exit, which can be a problem if you move regions or sell before the term ends.
When does refinancing not make sense?
If you owe less than $150,000, plan to sell within twelve months, or face high fixed-rate break costs, the upfront expense may outweigh the interest savings. You need enough time in the new loan to recover the switching costs.
