Equity Release and Refinance

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psrproperty
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@psrproperty
Join Date: 2020
Post Count: 3
September 6, 2020 - 10:43 pm
Are Equity Release and Refinance the same thing?
Jaxon
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@jaxona
Join Date: 2014
Post Count: 284
September 7, 2020 - 8:46 am
Good Day psproperty,
So technically they are different in the sense refi is restructuring a loan.
Equity release may be many terms or means to release the equity.
From my understanding its more an overview of a way to release equity without selling as per the below structures
-Reverse Mortage
-partial sale
-sell FV of property
-Line of Credit (may not be deemed equity release, but similar)

Wish you all the best!
Kind regards
Jaxon Avery
Disclaimer: This is general information only & may not be right for your situation or circumstances.

Jaxon | Jaxon Avery – Financial Adviser
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JPA Financial Services Pty Ltd
Terryw
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@terryw
Join Date: 2001
Post Count: 16,213
September 7, 2020 - 7:00 pm
psrproperty wrote:
Are Equity Release and Refinance the same thing?
nope
Refinance = paying one loan out with another
Equity release = borrowing against an existing property
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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Philip-Green
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@philip-green
Join Date: 2020
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October 1, 2020 - 7:55 pm
I think this will help you more

Let’s say that 10 years ago, when you first purchased your home, interest rates were 5% on your 30-year fixed-rate mortgage. Now, in 2020, you can get a mortgage at an interest rate of 3.5%. Those one-and-a-half points can potentially knock hundreds of dollars a month off your payment, and even more off the total cost of financing your home over the term of the loan. A refinance would be to your advantage in this case.
Terryw
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@terryw
Join Date: 2001
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October 1, 2020 - 9:02 pm
The maximum fixed loan is generally 5 years in Australian
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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Jamie Moore
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@jamie-m
Join Date: 2010
Post Count: 5,069
October 23, 2020 - 11:47 am
psrproperty wrote:
Are Equity Release and Refinance the same thing?
They’re two different things.
Having said that – a refinance and equity release often happen at the same time.
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
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Benny
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@benny
Join Date: 2002
Post Count: 1,416
October 24, 2020 - 9:27 am
Hi Philip Green,
Let’s say that 10 years ago, when you first purchased your home, interest rates were 5% on your 30-year fixed-rate mortgage. Now, in 2020, you can get a mortgage at an interest rate of 3.5%. Those one-and-a-half points can potentially knock hundreds of dollars a month off your payment, and even more off the total cost of financing your home over the term of the loan.
That WOULD be a good idea, except that the lender will have break costs on a Fixed Loan that is likely to cost you ALL of what you would save, and then some more. So, before anyone goes “breaking” a Fixed Loan, ask for a payout figure first, then do your sums !!!
Benny