If You Haven’t Refinanced Your Home Loan in Brisbane in the Last Two Years, Read This First
Let’s put a number on it. If you’re sitting on a $700,000 home loan at a rate of 6.40% and your lender’s current offer for new customers is 5.89%, you’re paying an extra $289 per month. That’s $3,468 a year. Over five years, you’ve handed your bank more than $17,000 for absolutely nothing. You could be missing on potential savings if you ignore refinancing your Brisbane home loan.
That’s the loyalty tax. And it’s silently draining Australian mortgage holders every single month.
With Brisbane’s property market continuing to grow and the RBA having moved rates through several cuts in 2025, there’s never been a better time to ask the question: could I be getting a better deal?
In this guide, we’ll break down exactly how much you could save, what it actually costs to refinance, and when it makes sense to make the switch.
The Loyalty Tax: What Your Bank Isn’t Telling You
Banks are in the business of acquiring new customers and they’re willing to offer sharp rates to get them. The problem? They rarely extend those rates to existing customers who’ve been faithfully making repayments for years.
This creates a gap (often between 0.30% and 0.70%) between what loyal borrowers pay and what new customers receive. It might not sound like much, but on a large Brisbane mortgage, it compounds into serious money.
The good news: lenders know that refinancing is easier than ever. That means you have leverage, whether you’re switching lenders or simply using a competing offer to negotiate a better rate with your current one. If you’d like a full breakdown of the process, our guide on how to refinance your mortgage walks through it step by step.
The Numbers: How Much Could You Actually Save?
Here are three realistic Brisbane mortgage scenarios and the potential annual savings from refinancing to a more competitive rate (based on switching from 6.40% to 5.85%):
Scenario 1: $600,000 Loan, 25 Years Remaining
- Monthly repayment at 6.40%: $3,978
- Monthly repayment at 5.85%: $3,793
- Monthly saving: $185
- Annual saving: $2,220
- 5-year saving: $11,100
Scenario 2: $750,000 Loan, 25 Years Remaining
- Monthly repayment at 6.40%: $4,972
- Monthly repayment at 5.85%: $4,741
- Monthly saving: $231
- Annual saving: $2,772
- 5-year saving: $13,860
Scenario 3: $900,000 Loan, 25 Years Remaining
- Monthly repayment at 6.40%: $5,967
- Monthly repayment at 5.85%: $5,690
- Monthly saving: $277
- Annual saving: $3,324
- 5-year saving: $16,620
These figures are illustrative and based on principal and interest repayments. Your actual savings will depend on your current rate, loan balance, and the rate you’re eligible for. Use our loan repayment calculator to model your own scenario, or speak with a Mortgage Box broker for a personalised comparison.
What Does It Actually Cost to Refinance?
Refinancing isn’t free, but the costs are often far smaller than people expect. In most cases, they’re recovered within the first 12 months of savings.
Here’s what you might encounter:
- Discharge fee (current lender): $150 to $400
- Application/settlement fee (new lender): $0 to $600
- Valuation fee: $0 to $300 (many lenders waive this)
- Government registration fees (QLD): approximately $200 to $350
- Break costs (fixed rate loans only): varies and can be significant. See our guide on fixed vs variable home loans in Brisbane if you’re unsure which applies to you.
For most variable rate borrowers, total refinancing costs sit between $500 and $1,500. If you’re saving $200 or more per month, you’ll break even within the first year. Everything after that is money back in your pocket.
Important note: if you’re currently on a fixed rate, check your break cost before making any moves. Breaking a fixed loan early can carry substantial fees, and the calculation needs to be done carefully to ensure refinancing still makes sense.
The Break-Even Calculation: When Does Refinancing Pay Off?
The simplest way to think about it:
Break-even point = Total refinancing costs divided by monthly savings
Example: if refinancing costs you $1,200 and saves you $250 per month, you break even in just under 5 months. After that, every month is pure saving.
As a rule of thumb, if you’re planning to stay in the property for more than 12 months and you’re saving $150 or more per month, refinancing almost always stacks up.
When Refinancing Doesn’t Make Sense
Not every situation calls for a switch. Here’s when it might not be worth it:
- You’re in the final 5 years of your loan, so the interest component is already low and savings are minimal
- You’re locked into a fixed rate with significant break costs that outweigh the savings
- Your financial situation has changed significantly and you may not qualify for a competitive rate
- You plan to sell the property within 12 months, so you may not reach break-even
A broker can quickly assess whether refinancing makes financial sense for your specific situation before you invest any time or energy into the process. You can also read more about the right timing in our article on refinancing after rate cuts.
What to Look for Beyond the Interest Rate
A lower rate is the headline, but the real value of refinancing is often in the features:
- Offset account: a 100% offset account can save you thousands in interest over the life of a loan, particularly useful in Brisbane where property values (and therefore loan sizes) are significant. See our guide on what extra repayments can mean for your home loan for more on this.
- Redraw facility: allows you to access extra repayments if you need them
- Repayment flexibility: can you make extra repayments without penalty?
- Cashback offers: some lenders offer $2,000 to $4,000 cashback on refinancing. Useful, but don’t let it distract from the headline rate and features.
The right loan isn’t always the one with the lowest rate on paper. Use our loan comparison calculator to weigh up your options side by side.
How a Mortgage Broker Makes This Easier
Comparing home loans in Australia is genuinely complex. There are hundreds of products across dozens of lenders, and the rates advertised publicly often aren’t the rates you’ll actually be offered. Lenders price risk individually: your employment situation, LVR, and credit history all affect what you’re eligible for.
A mortgage broker does the comparison work for you, at no cost. They have access to products across a wide panel of lenders, can identify who will assess your situation most favourably, and manage the paperwork from application to settlement. Not sure if it’s worth using a broker? Read our piece on whether mortgage brokers are worth it.
For Brisbane homeowners sitting on rates from 2021 to 2023, there are often significant savings available. It just takes someone to run the numbers.
Find out exactly how much you could save with refinancing your Brisbane home loan. Book a free mortgage health checkwith Mortgage Box today, no obligation.
