Transfer Loan – Gain Control When Banks Say No (2026)

If you're feeling burdened by high interest rates or unfavourable loan terms with your current bank, you might be wondering if there's a way to ease this strain. Transferring your loan to another bank could be the solution you're seeking, offering potential savings and more favourable terms. But how does this process work, and is it the right move for you?

Understanding Loan Transfers

Transferring a loan, often referred to as refinancing, involves moving your existing loan from one lender to another. This process can provide benefits such as lower interest rates, reduced monthly repayments, or better loan features. However, it's not merely about finding a lower rate—understanding the entire financial picture is crucial.

Current Market Information and Options

As of 2026, interest rates in Australia for home loans typically range from 6.49% to 12%, depending on the loan type and borrower’s financial profile. This is a competitive landscape, with many lenders willing to offer attractive rates to gain new customers. To make an informed decision, it's vital to understand the available options and requirements.

Eligibility criteria for refinancing generally include a stable income, a good credit score, and sufficient equity in your property. Lenders may also impose a maximum loan-to-value ratio (LVR), typically around 80%.

Steps to Transfer Your Loan

Transferring your loan to another bank involves several key steps:

1. Assess Your Current Loan: Start by understanding your current loan terms, interest rate, and any exit fees or penalties for early repayment.
2. Research Potential Lenders: Compare offers from different lenders. Esteb and Co can assist with access to over 83 lenders, ensuring you find a competitive deal that suits your needs.
3. Calculate Potential Savings: Use online calculators to estimate how much you could save by refinancing. Consider both interest savings and any associated costs, such as application fees and valuation charges.
4. Apply for a New Loan: Once you've chosen a suitable lender, submit your application. Be prepared to provide documentation such as proof of income, property valuation, and a credit report.
5. Approval and Settlement: Upon approval, your new lender will pay off your existing loan and the new loan agreement will commence.

Expert Tips and Considerations

Before making the switch, consider the following expert advice:

• Understand Fees: Calculate all potential costs, including exit fees from your current lender and any setup fees with the new lender.
• Consider Loan Features: Evaluate the loan features that are important to you, such as offset accounts and redraw facilities, and ensure the new loan offers these.
• Beware of Short-Term Offers: Be cautious of introductory rates that might increase significantly after the initial period.
• Check Your Credit Score: A strong credit score can help you secure better terms. Consider improving your score before applying.
• Consult a Broker: Mortgage brokers like Esteb and Co can provide valuable insights and help navigate the complexities of refinancing.

Frequently Asked Questions

1. Can I transfer any type of loan to another bank? While most loans can be transferred, certain types, such as fixed-term loans, may have restrictions or penalties.
2. How long does the loan transfer process take? The process typically takes 4-6 weeks, but this can vary depending on the lender and your financial circumstances.
3. Will transferring my loan affect my credit score? Applying for a new loan can temporarily impact your credit score, but the long-term benefits often outweigh this initial effect.
4. What documents will I need to provide? Common documents include proof of income, recent bank statements, a property valuation, and identification.
5. Are there any risks involved in transferring my loan? Potential risks include incurring fees that outweigh savings or ending up with a less favourable loan if not carefully evaluated.
6. How do I know if I'm eligible to transfer my loan? Lenders typically require a stable income, a good credit score, and sufficient equity in your property.
7. Why should I consider using a mortgage broker? A broker can provide access to a wider range of lenders and help secure a competitive rate tailored to your needs.