Mortgage Choice : Don't be haunted by your home loan this Halloween

If your mortgage debt is sending chills up your spine, now could be the perfect time to do something about it.

Whether you've had your home loan for a year or more than a decade, now is a good time to review your situation.

Mortgage Choice chief executive officer John Flavell said interest rates were currently sitting at all-time lows, which is great news for both home owners and property investors.

'After the Reserve Bank of Australia cut the official cash rate in August, the nation's lenders followed suit, taking home loan interest rates to new lows,' he said.

'Today, some lenders are offering interest rates as low as 3.78%. With that said, property investors and owner occupiers who are paying more than 4.5% interest on their mortgage could be paying too much.

'I would encourage all property owners to take the time this Halloween to review their mortgage and see if they are still in the best solution for their needs.'

With Christmas right around the corner, Mr Flavell said it was now the ideal time for property owners to review their mortgage and potentially refinance into a sharper rate.

'By refinancing into a lower rate you can significantly reduce your monthly mortgage repayments and, in turn, free up some of your cash flow,' he said.

'And if you have more money in your back pocket each month, you should feel less financially stressed come the silly season.

'Of course, for those thinking of refinancing their mortgage, there are a few simple steps you should follow to ensure you don't fall victim to a money trick this Halloween.'

Step 1: Do your research

Mr Flavell said it was critical for people to do their research online first and see what home loan products and interest rates are available to them.

'By knowing what else is available on the market, you can determine whether refinancing is the best option for your needs,' he said.

Step 2: Speak to a professional

'Once you have established whether there is a better product for you on the market, it is important to speak with a professional.

'Your local mortgage broker can do all of the leg work for you and liaise with a number of lenders to negotiate you the best possible mortgage for your unique set of circumstances.'

Step 3: Work out the cost

Finally, Mr Flavell said it was critical for mortgage holders to understand the costs associated with refinancing before heading down this path.

'While there can be some fantastic benefits in refinancing your home loan, there are costs associated with the process, including break fees, loan application fees, valuation fees, settlement fees, stamp duty and, in some instances, Lenders Mortgage Insurance,' he said.

'The costs associated with refinancing can be significant. As such, it is important for you to work out how much money you will save by refinancing and then identify whether it will outweigh the cost of refinancing.'