Your home loan health check while overseas

By Chez Richter, Senior Mortgage Broker at Hypothèque · Updated 2026-11-05 · 5 min read

Out of sight is out of mind, and a mortgage nobody looks at tends to get more expensive. Give it an hour once a year.

The short version

Older loans often sit on higher rates than lenders offer new customers. The ACCC found this gap widens the longer a loan runs [1].
Ask your current lender for a better rate first. It costs nothing and sometimes works [2].
Switching has real costs: discharge fees, break costs on fixed loans, new establishment fees, and possibly lenders mortgage insurance again if your equity is under 20% [2].
Refinancing from overseas is possible but narrower: fewer lenders assess foreign income, so check eligibility before you start.
With the RBA lifting the cash rate to 4.85% on 3 November 2026, now is a sensible time to look [3].

Why expats need a check-up more than most

When you live in Australia, rate changes arrive in your letterbox and your mates complain about them at the barbecue. Overseas, you hear about them late, if at all. Meanwhile your circumstances have probably shifted: your home may now be a rental, your income may be in another currency, and your plans may have changed from "two years in Singapore" to "who knows".

A loan set up for a couple living in Brisbane on two Australian salaries may be the wrong shape for that same couple renting out the Brisbane house from Seoul.

The "loyalty gap" is real

Back in 2020, the ACCC's home loan price inquiry found that borrowers with loans three to five years old were paying about 0.58 percentage points more than the average new loan, and borrowers with loans older than ten years about 1.04 points more [1]. On a $250,000 loan, it estimated switching to the average new-loan rate could save more than $1,400 in the first year [1].

Those figures are from 2020 and the market has moved since, so treat them as an illustration rather than today's gap. But the pattern they describe, where existing customers quietly fall behind new ones, is why a regular check matters.

The health check: six things to look at

Check	What to look for	Red flag
1. Your rate	Compare your current rate with what your lender and others offer new borrowers on similar loans	You don't know your rate without logging in
2. Loan type	Owner-occupier or investment, matching how the property is used now	The house is rented but the loan still says owner-occupied
3. Repayment type	Principal and interest, or interest-only, and when any interest-only period ends	An interest-only period ending soon with no plan
4. Fixed or variable	When any fixed period expires and what rate it rolls onto	A fixed term expiring while you're overseas
5. Fees	Annual package fees, account fees, offset fees	Paying for a package you no longer use
6. Features	Offset, redraw, split loans, and whether they still suit you	Cash sitting in a savings account instead of an offset

A note on offset and redraw

If your property is now rented, how you use redraw matters for tax. The ATO looks at what borrowed money is used for: interest on money redrawn for private spending isn't deductible, and refinanced debt generally keeps the character of the original borrowing [4]. Before you restructure, pay down or redraw, talk to a tax adviser who understands your situation.

Step one: ask your lender

Moneysmart's first suggestion is the simplest: contact your current lender, tell them you're considering a cheaper loan elsewhere, and ask whether they can lower your rate [2]. Having at least 20% equity and a good credit history strengthens your hand [2].

From overseas, this is often easiest by secure message or a scheduled call. Have your loan number, current balance, an estimate of the property's value, and one or two competing offers ready. If your lender won't move, you have learned something useful.

Step two: count the cost of switching

A lower rate only helps if the savings outweigh the cost of moving. Moneysmart lists the main costs [2]:

Discharge fee to close your current loan.
Break costs if you are leaving a fixed-rate loan early; these can be large.
Application or establishment fees on the new loan.
Switching fee if you move to a different product with the same lender.
Stamp duty or government charges, which may apply when refinancing; check with your lender.
Lenders mortgage insurance again if your equity is below 20%. In some cases you can ask for a partial refund of LMI paid on your current loan [2].

Moneysmart's mortgage switching calculator shows how long it would take to recover your switching costs [5]. Keep the loan term similar to what you have left; stretching it back to 30 years lowers repayments but adds interest [2].

Step three: refinancing as an expat

This is where living abroad makes a difference. Many lenders restrict or decline lending to borrowers who earn their income overseas, and those that do lend apply their own rules on which currencies they accept and how much of the income they count. That means:

Check eligibility before applying. Each formal application can show on your credit file. Find out which lenders will consider your income and residency first.
Gather documents early. Expect overseas payslips, an employment contract or letter, tax returns or statements from your country of residence, bank statements, and proof of identity. Some may need translation.
Plan for signing and identity checks. Mortgage documents may need to be witnessed, and Australian embassies can witness signatures on many Australian documents if you book ahead [6].
Watch your timing. If your fixed term expires soon, start the process a few months early so you have options before you roll onto a revert rate.

Sometimes the best outcome is not to switch lenders at all but to restructure with your current one: change the product, add an offset, split the loan, or correct the loan type to match how the property is used.

Your yearly routine

Put a reminder in your calendar for the same month each year.
Log in and record your rate, balance, fees and any fixed or interest-only end dates.
Compare against current offers for similar loans.
Call your lender and ask for a better deal.
If they say no, run the switching calculator and decide whether a broker or another lender is worth exploring.
Check any changes with your tax adviser if the property is rented.

Your home loan health check while overseas: is your mortgage still pulling its weight?