Refinance cashback: is the offer worth switching for?

A $3,000 cashback might cover the switching costs and leave something over. But a higher rate or fees can use it up while you're still repaying the loan.

The named offer below is a dated example, not a promise of availability. Deadlines, application channels and eligibility can change, so get the lender's current written terms before applying.

If you have 22 years left, ask what the new loan costs over 22 years. A quote over 30 years spreads the debt over another 8 years and may look easier each month for that reason alone.

You can still consider extending the term if you need a lower payment. Just show that choice separately from the saving on the rate. Compare the same balance and repayment type as well, so you're not measuring several different changes at once.

Ask your current lender for a rate review or retention offer too. Staying may avoid switching costs, although you still need to compare the result with the alternatives. Our refinance guide explains that starting comparison.

Include discharge and registration costs, application or settlement charges, any valuation charge and ongoing package or account fees. If part of the existing loan is fixed, get a dated break-cost quote.

Check whether lenders mortgage insurance, or LMI, could apply to the new loan. It protects the lender rather than you. Where equity is limited, a new LMI cost can outweigh the savings. Equity is the property's value left after the mortgage debt.

Include the features you use. An offset is a linked account whose balance reduces loan interest. If you keep savings there, compare the interest benefit and the account cost under each loan. A lower advertised rate without that useful feature may not produce the better result.

To qualify for ME Bank's $3,000 external-refinance cashback in this dated example, you need at least $700k in new lending and an LVR up to 80%. You must settle within 120 days of application. The cashback is paid within 60 days after settlement into an eligible SpendME account, not the loan.

Its separate $2,000 offer requires at least $400k new lending and an LVR above 80% and up to 95%, with LMI payable. Both offers exclude owner-occupier interest-only loans. Both offers have BOQ Group refinance and recent-cashback exclusions, and they cannot be combined. ME can change or withdraw the offers.

The practical difference: someone with a smaller deposit might meet the $2,000 offer's conditions but still face an LMI bill larger than the cashback. Don't borrow more or accept a dearer loan just to cross an offer threshold.

The advertised application deadline is 28 February 2027, with settlement within 120 days. Confirm the offer still applies when you submit.

These are dated market examples, not confirmation that an offer is available through Hunter Galloway. We would confirm the application channel and full written conditions before including any incentive in your comparison. Our ME Bank home loan review explains the wider loan features.

Book a free refinance assessment with your current statement and any offer you have received. We can compare suitable loans over the years you expect to keep them, using the same remaining term. That shows whether extra interest or fees would use up the cashback.

Get the offer in writing and keep it with your application records. Check how long you need to stay and whether leaving early means repaying the cashback. Then work through the conditions that apply:

• Is the offer for external refinancing, or selected borrowers only?
• Is there a minimum loan size or maximum loan-to-value ratio? That ratio is your loan as a share of the lender's property value.
• Are your property purpose and repayment type included?
• What are the application and settlement deadlines?
• Must you open a transaction account or take another product?
• When will the money be paid, and what conditions could require you to repay it?

These are questions to check, not a claim that every lender imposes every condition. If settlement might be delayed, ask what happens to the offer. Submitting an application doesn't necessarily secure payment.

Don't rely on the cashback to cover costs that fall due before it arrives. Confirm its payment date and have the funds for earlier costs available separately.

A loan can look good over 1 year and less attractive over 5. Use the period you reasonably expect to keep it, then test a shorter and longer period too. If cashback eligibility is still uncertain, include a version without it.

Broker view: Ask for the answer in dollars: upfront costs, ongoing payments, interest, fees, cashback timing and the balance left at the end. The biggest incentive won't necessarily win once the full comparison is done.

Here's a deliberately simplified example. Both loans are otherwise suitable, with the same balance, term and repayment type. These figures are invented inputs, not available offers.

Loan B starts $2,000 ahead after its extra upfront costs. On a constant $500,000 balance, the extra 0.20 percentage points costs about $1,000 a year in interest. After about 2 years, that initial benefit is gone.

A real principal and interest loan doesn't keep a constant balance. Rates can change and repayments differ, so this isn't a full mortgage projection.

It shows why the $3,000 headline and the saving aren't the same amount. A proper comparison calculates interest, fees, payments and remaining debt over the period you expect to keep the loan.

Ask our Brisbane mortgage brokers for the side-by-side figures, with and without cashback, using the same balance and remaining term. Include the expected payout date and any early-exit conditions. Our guide to choosing a mortgage broker in Brisbane explains what to ask before choosing who handles the refinance. Call Hunter Galloway on 1300 088 065 or request a free assessment.