If you are a homeowner, you may be familiar with the process of refinancing or refixing your mortgage. Refinancing refers to taking out a new mortgage with a different lender to pay off your existing mortgage, while refixing means renegotiating the terms of your current mortgage with your current lender. In this blog post, we will explore the pros and cons of each option and give you some tips on how to make the right choice for your situation. 

 Refixing Your Mortgage 

When you refix your mortgage, you are essentially renewing your current mortgage with your current lender. This involves negotiating a new interest rate and possibly changing the length of your mortgage term. Here are some pros and cons to consider before deciding to refix your mortgage: 

Pros: 

1. Stability: Refixing your mortgage can provide stability in your finances, as you will know exactly how much your mortgage payments will be for the next few years. 

1. Lower Costs: Refixing your mortgage can sometimes result in a lower interest rate, which can save you money over the long term. 

1. Less Paperwork: Refixing your mortgage requires less paperwork than refinancing, which can be a major plus for busy homeowners. 

Cons: 

1. Limited Options: Refixing your mortgage means you will be sticking with your current lender, which may not offer the best interest rates or mortgage terms. 

1. Missed Opportunities: Refixing your mortgage may mean missing better interest rates or mortgage terms that become available later on. 

1. No Equity Release: Refixing your mortgage does not allow you to release equity from your home, which may be necessary if you need to access funds for a major expense. 

Refinancing Your Mortgage 

Refinancing your mortgage involves taking out a new mortgage with a different lender to pay off your existing mortgage. Here are some pros and cons to consider before deciding to refinance your mortgage: 

Pros: 

1. More Options: Refinancing your mortgage means you will have access to a wider range of lenders and mortgage terms, which can result in better interest rates and terms. 

1. Equity Release: Refinancing your mortgage allows you to release equity from your home, which can be useful if you need to access funds for a major expense e.g. renovations 

1. Better Rates: Refinancing your mortgage can result in a lower interest rate, which can save you money over the long term. 

1. Most main bank lenders offer a cash back which will more than cover your legal costs and leave you change to spend 

Cons: 

1. More Paperwork: Refinancing your mortgage requires more paperwork than refixing, which can be a hassle for busy homeowners. 

1. Additional Costs: Refinancing your mortgage can involve additional costs, such as application fees, valuation fees, and legal fees. 

1. Less Stability: Refinancing your mortgage means you will be starting a new mortgage term, which can result in less stability in your finances. 

 Tips for Refixing or Refinancing Your Mortgage 

1. Shop Around: Whether you are refixing or refinancing your mortgage, it is important to shop around and compare offers from different lenders to ensure you are getting the best deal. A mortgage broker will be the best person to assist with this as they have all the lender calculators and policies at hand 

1. Consider Your Needs: Before deciding whether to refix or refinance your mortgage, consider your current and future financial needs to determine which option is best for you. 

1. Calculate the Costs: Be sure to calculate the costs of refixing or refinancing your mortgage, including any additional fees, to determine whether it is worth it in the long run. 

1. Seek Professional Advice: If you are unsure about whether to refix or refinance your mortgage, seek professional advice from a mortgage broker or financial advisor.