When you're working FIFO in South Australia, managing your finances from remote locations can feel challenging. If you're considering refinancing your home loan, understanding the settlement procedures is crucial for making the process smoother and more predictable.
What Happens During Refinancing Settlement
Refinancing settlement is the final stage where your new loan officially replaces your existing one. This process involves several key steps that typically take place over 30-45 days from application approval.
During settlement, your new lender pays out your existing loan and takes over the mortgage on your property. The settlement agent coordinates between all parties - your current lender, new lender, solicitor, and you - to ensure everything happens on the agreed date.
Pre-Settlement Requirements
Before settlement day arrives, you'll need to complete several important tasks:
• Property valuation: Your new lender will arrange this to confirm your property's current value
• Loan documentation: Review and sign all loan agreements and mortgage documents
• Insurance arrangements: Ensure your home and contents insurance meets the new lender's requirements
• Final loan details: Confirm your loan amount, interest rate, and repayment schedule
Your Finance & Mortgage Brokers will help coordinate these requirements, especially important when you're on-site and can't handle everything in person.
Understanding Settlement Costs
Refinancing settlement involves various costs that FIFO workers should budget for:
• Discharge fees: Typically $150-$400 to your current lender
• Settlement agent fees: Usually $600-$1,200 depending on loan complexity
• Government charges: Stamp duty may apply in some circumstances
• Valuation costs: Often $300-$600, sometimes covered by the new lender
These costs can often be added to your new loan amount, which helps manage cash flow when you're between swings.
The Settlement Day Process
On settlement day, several things happen simultaneously:
- Funds transfer: Your new lender transfers the loan amount to the settlement agent
- Existing loan discharge: Your old lender receives the payout amount and releases the mortgage
- New mortgage registration: The new lender's mortgage is registered on your property title
- Final adjustments: Any interest adjustments or fee calculations are finalised
Most settlements occur electronically, which works well for FIFO workers who might be on-site during the process.
Why FIFO Workers Refinance
Many South Australian FIFO workers refinance to achieve specific financial goals:
Accessing a lower interest rate can significantly reduce loan repayments over time. With your variable interest rate or when your fixed rate period ending approaches, refinancing might offer substantial savings.
Releasing equity in your property allows you to access funds for other investments or to release equity to buy the next property. This strategy works particularly well for FIFO workers with steady income streams.
Change your loan term to either reduce monthly payments or pay off your mortgage sooner, depending on your current financial situation.
Consolidate debts by combining credit cards, personal loans, and other debts into your mortgage, often at a much lower interest rate.
Working with Specialised Brokers
FIFO workers face unique challenges in the application process. Many traditional lenders don't fully understand FIFO employment arrangements, but specialised Finance & Mortgage Brokers can access loan options from banks and lenders across Australia who do.
When you work with FIFO Home Loans, we understand how to present your bank statements and employment documentation in ways that highlight your income stability. We can also check eligibility for special lender policies designed for FIFO workers.
Choosing Between Fixed and Variable Rates
Your refinancing settlement will lock in either a fixed interest rate or variable interest rate structure. Consider your personal circumstances:
• Variable interest rate: Offers flexibility and potential savings when rates fall
• Fixed interest rate: Provides payment certainty, valuable for budgeting during roster cycles
Your broker can explain current refinance interest rates and help you understand which option suits your financial situation.
Managing Settlement While On-Site
The streamlined application process available through experienced mortgage brokers makes refinancing possible even when you're working remote shifts. Digital document signing and electronic settlement mean you don't need to be physically present for most procedures.
However, ensure you have reliable communication access around settlement time for any last-minute queries or document requirements.
Refinancing settlement doesn't have to be complicated, especially when you work with brokers who understand the FIFO lifestyle. With proper planning and the right support, you can successfully refinance while maintaining your work commitments.
Call one of our team or book an appointment at a time that works for you. We'll handle the settlement coordination while you focus on your FIFO schedule.
