Mortgage rates, inflation, and the housing market have seen significant changes over the past few years — and if you’re a homeowner in New Zealand, you might be wondering: Should I refinance my mortgage in 2025?
Refinancing can be a smart financial move, but it’s not a one-size-fits-all solution. Let’s break down what refinancing is, when it makes sense, and what you need to consider in today’s market.
What is Mortgage Refinancing?
Refinancing is when you replace your existing mortgage with a new one — ideally with better terms. It could involve:
- Switching to a lower interest rate
- Changing the loan term (e.g., from 30 years to 20 years)
- Moving from a floating to a fixed-rate loan (or vice versa)
- Accessing equity in your home for renovations or investment
Why Kiwis Are Considering Refinancing in 2025
2025 presents unique conditions that make refinancing worth a second look:
- Interest Rate Adjustments: After a period of high inflation, rates have started to stabilise — but could drop further depending on Reserve Bank decisions.
- Equity Growth: If your home’s value has increased, you might qualify for better terms or access equity at a lower cost.
- Rising Living Costs: Many New Zealanders are looking to lower monthly repayments to free up cash flow.
When Refinancing Makes Sense
Here are a few signs refinancing could benefit you:
✅ Your current rate is significantly higher than what’s available now
✅ You want to consolidate debt into your mortgage
✅ You’re planning major home improvements
✅ You want to switch from interest-only to principal-and-interest payments
✅ You’re coming off a fixed-term and want to shop for better rates
When to Think Twice
Refinancing isn’t always the right move. Consider holding off if:
❌ You’re already on a competitive rate
❌ You’re planning to sell soon
❌ The break fees from your current lender are too high
❌ Your financial situation has changed and you may not qualify for a better deal
What Fees Are Involved in Refinancing?
While refinancing could save you money in the long run, it can involve some short-term costs:
- Break fees (if you’re exiting a fixed-term early)
- Legal fees and valuations
- New application or lender fees
Always calculate the total cost versus long-term savings.
How to Get Started
Thinking about refinancing? Here’s a simple checklist:
- Review your current mortgage – Know your current rate, term, and conditions.
- Check the market – Compare rates from different lenders.
- Get expert advice – A mortgage advisor can assess your situation and recommend the best path forward.
- Calculate the savings – Use online calculators or get a personalised quote.
Final Thoughts
Refinancing in 2025 can offer real savings, flexibility, and peace of mind — but only if it aligns with your financial goals. With interest rates showing potential to drop and home equity rising in many regions, now might be the right time to explore your options.
At Secure Mortgage, we help Kiwis make smart refinancing decisions. Whether you’re looking to save on interest or unlock your home’s equity, we’ll guide you through the process from start to finish.
