Refinance cashback offers can be a great incentive to refinance your home loan, but it’s important to weigh the benefits against the potential drawbacks. Here are some factors to consider when deciding whether to go for a refinance cashback offer or a no cashback option:
- Interest rates: Interest rates are the most important factor to consider when refinancing your home loan. If the interest rate on the refinance cashback offer is higher than the interest rate on a no cashback option, then the cashback may not be worth it in the long run.
- Fees: Refinancing your home loan typically incurs a range of fees, such as application fees, valuation fees, and discharge fees. A refinance cashback offer may cover some or all of these fees, but it’s important to ensure that the fees being waived or covered are not outweighed by the higher interest rates.
- Loan features: Consider whether the refinance cashback offer includes any additional loan features, such as a redraw facility or offset account, which may be useful for your financial situation.
- Repayment terms: Refinancing your home loan often means extending your loan term. Ensure that the refinance cashback offer does not come with a longer loan term than you are comfortable with, as this could result in more interest paid over the life of the loan.
Ultimately, it’s important to compare the total cost of both the refinance cashback offer and the no cashback option, taking into account interest rates, fees, loan features, and repayment terms, before making a decision.