Five Life Changes That Should Trigger a Home Loan Review
Most people review their phone plan, insurance and household bills regularly.
But when it comes to their home loan, many borrowers set it up and leave it untouched for years.
Your home loan may have suited you when it was first arranged, but your circumstances, financial goals and available lending options can change over time.
Here are five life changes that should prompt you to review whether your current home loan is still right for you.
Your income or employment has changed
A pay rise, promotion, new job or move into self-employment can change your financial position.
You may now have the capacity to:
- Make additional repayments
- Pay your home loan off sooner
- Consolidate other debts
- Purchase an investment property
- Upgrade your home
A reduction in income is also a reason to review your loan. Restructuring repayments or adjusting your loan before cash flow becomes tight may give you more options.
Your family circumstances have changed
Getting married, having children, separating or supporting family members can all affect your household budget and future plans.
A home loan review can help you understand whether your current repayment structure still works for your family.
It can also identify opportunities to create more flexibility through an offset account, repayment changes or a different loan structure.
Your property may have increased in value
As you repay your loan and your property changes in value, the equity available in your home may increase.
Depending on your position, that equity could potentially help you:
- Renovate or improve your home
- Purchase another property
- Consolidate higher-interest debts
- Support an adult child entering the property market
- Create a financial buffer
Having equity does not automatically mean that borrowing more is the right decision. Affordability, repayments and your longer-term goals should always be considered.
Your fixed rate is ending
When a fixed-rate period ends, your loan will generally move onto a variable rate selected by your lender.
This is an important time to review your options rather than simply accepting the new rate and repayments.
Before the fixed period expires, you can assess:
- The lender’s proposed variable rate
- Other fixed and variable options
- Whether a split loan may suit you
- The features you need
- The costs of refinancing
Starting the conversation early gives you time to make an informed decision.
Your future plans have changed
Your home loan should support where you are going, not only where you were when you first borrowed.
You may now be considering:
- Buying your next home
- Keeping your current home as an investment
- Renovating
- Starting a business
- Helping your children buy
- Preparing for retirement
Each of these goals may require a different lending strategy.
When did you last review your home loan?
A review does not necessarily mean changing lenders.
Sometimes the right outcome is to restructure your existing loan, negotiate with your current lender or confirm that the loan you already have remains suitable.
At Kredi Home Loans, we can review your current position, compare your loan against available options and help you understand the next steps.
A 15-minute conversation could help you determine whether your home loan still supports your current circumstances and future plans.