Refinance & restructure your mortgage
Book a chatYour mortgage was probably right for you when you took it out. The question is whether it's still right now
A change in income, family circumstances, debt, interest rates or future plans can make a loan structure that once worked perfectly feel increasingly awkward. And sometimes nothing dramatic has happened at all.
The mortgage has simply been sitting there for a few years doing whatever the bank set it up to do. Worth a look.
Refixing, refinancing and restructuring are different things
They’re often used interchangeably, but they aren’t the same.
Refixing
Choosing a new fixed interest rate with your existing lender when your current fixed term ends.
Refinancing
Moving your mortgage from one lender to another.
Restructuring
Changing the way your lending is set up – for example loan splits, terms, offset accounts or revolving credit – whether you stay with your bank or move.
Sometimes refinancing is the answer.
Quite often, a restructure is where the bigger opportunity sits.
Becoming mortgage-free is an active decision
Most mortgages begin on a 30-year term because that’s what makes the numbers work at the start. Life then changes.
You might buy your first home before having children. Cashflow gets squeezed while one parent is home or childcare costs are high.
Later incomes increase, childcare reduces and suddenly there’s more room.
That’s where active decisions around repayments can make an enormous difference.
Rather than relying on the original 30-year plan, we help clients work out when cashflow can be redirected towards getting rid of the mortgage sooner.
Frequently Asked Questions
My fixed rate is ending. Now what?
Don’t wait for your bank’s rollover email and assume clicking one of the rates is the whole decision.
This is a natural point to review:
- the loan term
- how much you’re repaying
- fixed versus floating
- whether loans should be split
- whether an offset or revolving facility might help
- whether your circumstances have changed
- whether another lender offers a genuine advantage.
We’ll look at the whole thing rather than trying to guess which fixed rate will win.
Why should I consider restructuring?
Structure can matter more than rate. Two households can borrow the same amount at the same interest rate and one can become mortgage-free years earlier.
Why? Because of what they do with their cashflow.
A mortgage structured entirely on one long fixed term offers very little flexibility.
Savings sitting in a low-interest bank account might achieve more in an offset facility.
Resetting a 25-year mortgage back to 30 years every time you refinance can quietly add years of repayments.
And keeping repayments at the same level when interest rates fall can potentially reduce the term without making any noticeable change to the household budget.
The interest rate matters, but it’s one lever, not the whole machine.
What are the benefits of restructuring?
Sometimes restructuring is about breathing room. Repaying a mortgage faster isn’t the right goal every single year. Sometimes life throws something else at you.
One Lower Hutt client came to us after a separation had significantly increased his home loan. His existing loan term made the repayments difficult to manage and he’d taken out a personal loan for normal household expenses.
By consolidating the lending and extending the home-loan term to suit his new circumstances, his repayments reduced by around $700 a fortnight. That created enough room to rebuild an emergency fund and reduced the likelihood of needing more personal debt.
Sometimes good mortgage advice is about paying faster. Sometimes it’s about creating enough space to get back on top of things.
Don’t see your question here?
It's probably worth reviewing
If it has been more than a year since someone properly looked at your mortgage, let’s do that.