Should You Refinance Your Home Loan?
Answer 5 simple questions to find out if refinancing is right for you
Refinancing Decision Tool
1. What is your current home loan interest rate?
2. How long have you been paying your current loan?
3. What is your outstanding loan balance?
4. What is your primary goal for refinancing?
5. Is your credit score in good standing?
When Should You Refinance?
These scenarios indicate refinancing could be beneficial
Interest Rates Have Dropped
Market rates are at least 0.5% - 1% lower than your current rate
Potential savings: RM 30,000 - 100,000 over loan tenure
Early in Loan Tenure (3-7 years)
You're still paying mostly interest, not principal
Maximum interest reduction potential
Credit Score Improved
Your CCRIS/CTOS score has improved significantly since original loan
Qualify for better rates (0.3% - 0.8% lower)
Need to Consolidate Debts
You have high-interest credit card or personal loans
Reduce overall debt burden by 40-60%
When NOT to Refinance?
Avoid refinancing in these situations to prevent losing money
❌ Late in Loan Tenure (10+ years)
Why: Most interest already paid - refinancing will not save much
Alternative: Continue with current loan and pay extra to finish early
❌ Low Outstanding Balance (<RM 100k)
Why: Refinancing costs will exceed potential savings
Alternative: Make lump sum payments to clear loan faster
❌ Already at Low Rate (<3.5%)
Why: Unlikely to find significantly better rates
Alternative: Negotiate with current bank for rate adjustment
❌ Planning to Sell Soon (within 2-3 years)
Why: Will not recoup refinancing costs before selling
Alternative: Wait until after property sale
Real Savings Example
See how much you could save with a 1% interest rate reduction
Current Loan
After Refinancing
Your Potential Savings
Refinancing Cost Breakdown
Top Banks for Refinancing (2024)
Maybank
- Flexi payment
- No lock-in period
- Free legal fees promotion
Best for: High loan amounts (>RM 500k)
CIMB Bank
- Cashback up to RM 10,000
- Flexi combo package
- Fast approval (5 days)
Best for: Quick processing
Hong Leong Bank
- Free MRTA
- Offset account
- Loyalty rewards
Best for: Existing customers
Public Bank
- Competitive rates
- Stable long-term
- Wide branch network
Best for: Conservative borrowers
6-Step Refinancing Process
Calculate Your Potential Savings
- Check current loan balance
- Research current market rates
- Use online calculators
Compare Bank Packages
- Get quotations from 3-5 banks
- Compare interest rates and features
- Check for promotions/cashback
Submit Applications
- Prepare required documents
- Submit to chosen banks
- Wait for approval letters
Negotiate and Accept
- Compare final offers
- Negotiate rates/fees
- Accept best offer
Legal Process
- Engage lawyer for documentation
- Sign loan agreement
- Bank settles old loan
Loan Disbursement
- New bank releases funds
- Old loan fully settled
- Start new repayment schedule
Pro Tips for Best Results
Negotiate everything - legal fees, processing fees, and interest rates are often negotiable
Apply to multiple banks to leverage better offers
Time your refinancing during bank promotion periods (typically March/September)
Ask about free legal fees or cashback - many banks offer these during campaigns
Calculate break-even point - ensure you will save more than refinancing costs
Consider lock-in period - avoid penalties if you plan to sell soon
Maintain good credit score before applying - improves approval chances
📚 Related Financing Guides
📊 Fixed vs Variable Rates
Understand which interest rate type saves you more money. Essential knowledge before refinancing your loan.
Read Interest Guide →🔍 Compare All Loan Types
Home loan vs personal loan vs car loan. Compare rates, terms, and find the best option for your refinancing needs.
View Comparison →🏠 Home Loan Documents
Checklist of 15 required documents for home loan refinancing. Prepare everything you need for faster approval.
See Documents List →Ready to Start Saving?
Get free quotations from multiple banks and find the best refinancing deal