What Is Home Loan Refinancing?
Lower Interest, Lower Payments, Better Cash Flow
Home loan refinancing means taking a new loan to pay off an existing mortgage primarily to reduce interest rates or restructure repayments to suit current finances
It can be done
With the same bank
Or by switching to a new lender with better terms
Main Reasons to Refinance
1) Lower Interest Rate
After promotional periods end
rates often increase—refinancing can reduce them
2) Lower Monthly Installments
Lower interest leads to reduced monthly payments
3) Adjust Loan Tenure
Extend tenure → lower installments
Shorten tenure → reduce total interest
4) Cash-Out / Top-Up
If property value allows additional funds may be borrowed
Common Refinancing Requirements
Banks reassess
Time already paid (usually ≥ 3 years)
Current property value
Outstanding loan balance
Borrower qualifications and credit bureau
Costs to Consider Before Refinancing
Refinancing is not always free
Borrowers should account for
Early settlement penalties (if any)
New mortgage registration fees
Valuation fees
Taxes and related charges
Ensure interest savings exceed total costs
FAQ
Q1: How long before I can refinance?
Typically after at least 3 years
Q2: Can I refinance with the same bank?
Yes, but compare offers carefully
Q3: Can I borrow extra funds?
Yes, if property value and criteria allow
Q4: Does credit history matter?
Yes, it is reviewed every time
