What fees are associated with switching home loan lenders in Australia?
Costs to weigh before switching home loan lenders — discharge fees, new-lender fees, government charges, break costs and LMI — no invented figures.
What fees are associated with switching home loan lenders in Australia?
Switching lenders — refinancing — can involve costs from three directions: your current lender (for discharging the loan), your new lender (for setting up the new one), and government charges for registering and removing the mortgage on title. Depending on your loan, a break cost or lenders mortgage insurance (LMI) may also apply. None of these are fixed nationwide figures — each is set by the individual lender or the relevant state or territory government — so this is a list of costs to weigh, not a bill you can total in advance.
The fee types to check before you switch
| Fee type | Who charges it | What it’s for |
|---|---|---|
| Discharge fee | Your current lender | Administration of ending the existing loan and mortgage |
| Application / settlement fee | Your new lender | Assessing and setting up the new loan |
| Mortgage registration fee | State/territory government | Registering the new lender’s mortgage on the property title |
| Mortgage discharge fee | State/territory government | Removing the old lender’s mortgage from the title |
| Break cost | Your current lender (fixed-rate loans only) | Compensates the lender if you exit a fixed rate early |
| Lenders mortgage insurance (LMI) | New lender’s insurer | Payable again if your new loan’s LVR is above 80% |
Discharge and application/settlement fees are set out in each lender’s own published pricing schedule and vary between institutions — check your current lender’s discharge fee and any new lender’s application and settlement fees directly, or ask a mortgage broker to compare them for you.
Government registration and discharge charges
Registering a new mortgage on your property’s title, and removing the old one, both attract a government fee set by the state or territory where the property sits — not by your lender. These fees vary by jurisdiction and are published by each state or territory land registry — check the relevant land registry’s current fee schedule for the amounts that apply to your property.
Break costs on a fixed-rate loan
A break cost (sometimes called an economic cost) can apply if you refinance out of a fixed-rate loan before the fixed term ends. It’s designed to cover the lender’s own cost of unwinding the fixed arrangement early, and it moves with the difference between your fixed rate and current market rates over the remaining term — not a flat number set in advance. As at July 2026, the RBA’s cash rate sits at 4.35% (last reviewed 16 June 2026), which is one input into the wider rate environment a break cost calculation reflects. The calculation itself is set out in your loan contract and the resulting cost varies by lender, by loan and by how far current rates have moved from your fixed rate — your lender can quote the figure that applies to your loan. Our guide to fixed vs variable interest rates explains why fixed loans carry this exposure and variable loans don’t.
Lenders mortgage insurance, again, if your LVR rises above 80%
LMI is usually payable when the amount you’re borrowing is more than 80% of the property’s value — and it protects the lender, not you. If refinancing means borrowing a higher proportion of your property’s current value than your existing loan (for example, because you’re increasing the loan amount, or the property’s value has fallen), LMI can become payable on the new loan even if you didn’t pay it originally. Our guide to what LMI is covers how it works and when it applies.
Weighing the costs against what switching might change
Whether the fees above are worth paying depends on what you’d get from the new loan — a lower rate, different features, or simply moving away from your current lender — set against every cost this article lists. That’s a calculation specific to your loan balance, your remaining term, and the offers in front of you; it isn’t something this article can total up for you. Some borrowers ask their current lender to improve their rate before switching at all — see our guide to negotiating your interest rate — while others find the new loan’s savings outweigh the switching costs. A mortgage broker or your current and prospective lenders can put real numbers against your own situation.
Our guide to how much deposit you need for a first home covers the equivalent costs when buying rather than switching.
