The Australian Securities and Investments Commission (ASIC) have released a calculator that helps you compare your current home loan situation with taking out a new home loan.
Please visit the ASIC Mortgage Switch Calculator for more information.
One of the main costs associated with mortgages is Lenders Mortgage Insurance. The ASIC calculator does take this into account but you need to find out what it will be. You should discuss this further with your mortgage adviser.
Lenders Mortgage Insurance (LMI) is an added cost where the size of the loan is greater than 80% of the value of the property against which the loan is being taken out. If the loan is greater than 80%, LMI will be an added cost which is usually added to the home loan amount.
The problem is if your loan is still greater than the 80% level new LMI will be needed for the new loan. To complicate things further a new valuation will be needed by the new lender and this may also cause further issues for consideration.
Warning: Switching your home loan or mortgage can lead to financial loss. You should get advice from a professional mortgage adviser before taking any action.