Stack the costs
List current lender exit costs, new lender setup costs, government or settlement costs, and any fixed break cost.
Refinance Costs
Check refinance costs before you compare savings.
A refinance cost check turns a lower-rate idea into a real comparison. The question is not just what the new repayment is. It is how long the costs take to recover, and what you give up to get there.
- Discharge fees
- Application fees
- Break costs
- LMI
A refinance cost check compares the cost of changing loans with the likely saving. It includes switching costs, break-even timing, possible LMI, break costs, cashback conditions, lost features and loan-term reset. A lower rate is not enough by itself.
Costs decide whether savings are real.
A lower rate only helps if the benefit outweighs switching costs, break-even timing, lost features and possible loan-term changes.
Estimate the monthly change
Compare the current repayment with a possible new repayment over a term close to the years left.
Find the recovery point
Divide switching costs by the monthly benefit. If there is no benefit, there is no repayment break-even.
Compare it with your plans
If you may sell, renovate, refix or move again before costs are recovered, the cheaper-looking loan may not help.
Costs to ask about.
The useful version of the cost list says where each number comes from. Keep estimates separate from lender quotes.
Current lender exit
- Discharge or termination fee
- Fixed-rate break cost
- Package or account closure fees
Where to find it: Ask the lender for a payout figure and written break-cost quote where relevant.
New lender setup
- Application or establishment fee
- Valuation fee
- Package or account fee
Where to find it: Lender fee schedule, broker comparison notes or the loan offer.
Settlement path
- Government registration fees
- Settlement or legal costs
- Conveyancing costs where relevant
Where to find it: Lender, broker, settlement agent, conveyancer or solicitor.
Equity and incentives
- Possible LMI
- Cashback conditions
- Clawbacks or minimum holding periods
Where to find it: Lender policy, lender offer terms and property valuation outcome.
The calculator is only the first pass.
A calculator can estimate savings, but a broker review checks whether the assumptions survive lender policy, valuation, documents, costs and the current lender's offer.
- Whether repricing with the current lender avoids some switch costs
- Whether LMI, valuation or lender policy changes the result
- Whether the new repayment relies on stretching the loan term
- Whether fees, cashback and features are being compared together
- Whether staying put, waiting or switching is the better next step
Broker support is general help and a handoff to licensed review, not automatic suitability. Licensed mortgage brokers owe you a best interests duty when suggesting a loan, and you can always ask how a broker is paid.
A cost check can still say no.
The point of the page is not to push a switch. The point is to sort the next action before the borrower spends time on a lender path.
Costs clear quickly
Estimated switching costs are recovered in a timeframe that still fits your plans for the property.
When it fits: Worth deeper comparison when the saving survives fees, features and term checks.Estimate the break-even pointAsk for a reprice first
Your current lender may improve the rate without a full switch, which can avoid some costs.
When it fits: Often worth testing before paying new lender, valuation, settlement or government costs.Compare the rate properlyWait for the break cost
A fixed-loan break cost may make an early switch poor value until the expiry date is closer.
When it fits: Common when the fixed period still has time to run or the quoted cost is high.Plan fixed-rate expiryKeep the remaining term
The monthly repayment saving only tells part of the story. Compare the new loan over a term close to the years left.
When it fits: Important when a fresh long term makes the repayment look better but total interest worse.Get better numbers first
The review is not ready until key costs, equity, valuation and document assumptions are checked.
When it fits: Useful when costs are estimates, LMI is uncertain or documents may affect lender assessment.Prepare the documentsStay put
The current loan may still be the better option if costs, term reset, LMI or lost features outweigh the saving.
When it fits: A legitimate outcome when the numbers do not support switching.Before you rely on the saving
Fixed loans need a written break-cost check.
If you exit a fixed-rate loan early, the lender may charge a break cost. Ask for a written estimate before deciding or relying on a calculator result.
LMI can erase a rate saving.
If the new loan is above lender LVR limits, lenders mortgage insurance may apply again and can outweigh rate savings.
Cashback is only one line.
Treat lender offers as part of the cost stack, not a shortcut around rates, fees, features, term and conditions.
- A cashback offer is not a saving until conditions, fees and clawbacks are checked.
- A lower repayment can hide a longer loan term and higher total interest.
- A fixed break cost can change quickly and needs a written lender quote.
- LMI may apply again if equity is under about 20 percent when switching.
Estimate the numbers before the conversation.
Calculators are estimates only. Use them to frame the cost question, then check lender quotes, policy, valuation and documents before acting.
Common questions
Questions borrowers ask about refinance costs.
What costs are common when refinancing?
Costs may include discharge, application, valuation, government, settlement, legal, break-cost, package and LMI costs depending on the loan and lender.
Can refinance costs outweigh the savings?
Yes. The break-even point and the remaining time you expect to hold the loan both matter. A lower rate can still be poor value if fees, LMI, break costs or a longer term erase the benefit.
What is a break-even point?
It is the point where the estimated savings have recovered the costs of switching. If there is no monthly saving, or the cost takes longer to recover than you expect to keep the loan, the refinance may not be worth it.
Should cashback count as savings?
Only after checking the conditions, clawbacks, fees, rate, features and loan term. Cashback can help, but it should not be the reason to ignore the full cost comparison.
Can LMI apply when refinancing?
It may. MoneySmart warns that borrowers with less than 20 percent equity might have to pay lenders mortgage insurance when switching, which can increase costs and outweigh a lower rate.
Which costs need exact quotes?
Fixed-rate break costs need a written lender quote. Settlement, legal, government, valuation and lender fees should also be checked against the actual lender path before relying on the saving.
What can a broker check that a calculator cannot?
A broker can check lender policy, likely valuation issues, document fit, current-lender pricing, fee assumptions and whether the cost comparison points to switching, repricing, waiting or staying put. You can always ask how a broker is paid.
Sources and further reading
General information only. It does not account for your personal circumstances. Guidance on this page was checked against official Australian sources:
- MoneySmart, Switching home loansChecked 4 July 2026
- MoneySmart, Mortgage switching calculatorChecked 4 July 2026
- MoneySmart, Using a mortgage brokerChecked 4 July 2026
Cost review
Bring the costs. Compare the next step.
Share the current loan, likely costs and timing through Quick Check so a broker can pick up the review where the calculator stops. General information and intake only. Any lending is subject to lender assessment.