Top Tips to Navigate Your Refinance Settlement

What Happens Between Approval and Settlement Day

Once your refinance application is approved, settlement typically occurs within four to six weeks. Your new lender prepares discharge documents, your conveyancer or settlement agent coordinates the payout figure with your current lender, and funds are arranged to transfer on the agreed date.

Consider a Maylands homeowner who received approval to refinance their home loan but continued making fortnightly payments to the old lender right up until settlement day. They assumed the switch would happen automatically. On settlement day, their account showed an overpayment because the discharge amount was calculated days earlier, and those extra payments created a small credit balance that took weeks to refund. The lesson is that once your settlement date is confirmed, check with your broker whether you should continue regular payments or hold off to avoid complications.

Who Coordinates the Refinance Settlement

Your new lender's settlement team handles most of the work, but you'll need a conveyancer or settlement agent to manage the legal side. In Western Australia, this involves preparing the discharge of mortgage for your existing lender and registering the new mortgage with Landgate. Your broker arranges the introduction, but the conveyancer works directly with both lenders to ensure the payout amount matches what your old lender requires and that funds arrive on time.

In our experience with Maylands properties, settlement agents familiar with the Bayswater local government area can move quickly because they already know the council processes for rates clearances and have established relationships with the land titles office. That local knowledge can shave days off the timeline, especially if your property has strata involvement or bushfire zone overlays that require additional documentation.

The Payout Figure and How It Changes Daily

Your old lender calculates a payout figure based on the settlement date, including the outstanding loan balance, accrued interest up to that day, and any discharge fees. Because interest accrues daily, the figure changes if settlement is delayed. Your conveyancer requests this figure about a week before settlement and confirms it again the day before funds transfer.

If your current loan has a redraw facility or offset account, the payout calculation adjusts for those balances. A Maylands borrower refinancing a loan with an offset holding $40,000 found their payout figure was reduced by that amount, but the funds in the offset weren't automatically transferred to the new loan. They had to manually move that money into their new offset account after settlement, which meant a few days without the offset benefit and additional interest charged on the full loan amount during that window.

What You Need to Provide Before Settlement

Your new lender will request proof of insurance for the property, usually at least a week before settlement. The policy needs to show the lender as the interested party, and the cover amount must meet their minimum requirements. If you're refinancing an older home near the Maylands Golf Course or anywhere close to the Swan River, insurers sometimes apply flood overlays or bushfire ratings that increase premiums, so allow time to compare policies rather than accepting the first quote.

You'll also need to confirm your identification documents are still current. If your driver's licence has expired since you submitted your refinance application, or if you've changed address and your ID doesn't match the property address, your conveyancer will need to verify your identity again using a different combination of documents. That can delay settlement by several days if you don't have a current passport or other backup ID ready.

What Happens on Settlement Day

Your new lender transfers the payout amount to your old lender, and your conveyancer ensures the discharge is registered with Landgate. You won't usually need to attend in person. Once the discharge is confirmed, your old lender releases their mortgage over the property, and your new lender's mortgage is registered in its place. The entire process happens electronically in Western Australia, so there's no physical paperwork to sign on the day.

Your first payment to the new lender is usually due about a month after settlement, but interest starts accruing from settlement day. If you're switching from a loan with fortnightly payments to one with monthly payments, check how that affects your budget in the first few weeks. Some borrowers in Maylands who refinanced to access equity found the change in payment frequency meant they had more cash available in the short term, but they needed to adjust their automatic transfers to avoid spending what should have been set aside for the next repayment.

If Settlement Is Delayed

Delays happen when the payout figure doesn't match what the old lender expected, when insurance documents are incomplete, or when there's a registration issue at Landgate. Your conveyancer will notify both lenders and arrange a new settlement date. If the delay is more than a few days, your new lender may need to reissue the loan documents with the updated settlement date, which can push things out another week.

If your fixed rate period is ending and you're refinancing to avoid reverting to a higher variable rate, timing matters. A delay of even a week can mean you start accruing interest at the revert rate before the refinance settles. Your broker can sometimes negotiate a rate lock extension with the new lender, but that's not guaranteed, so build in a buffer when choosing your settlement date.

After Settlement: What Changes Immediately

Your old loan account closes within a few days of settlement, and your new loan account becomes active. If you had direct debits set up for the old loan, cancel them to avoid failed payment attempts. Set up new direct debits with your new lender, and if you're using an offset account, transfer your savings across as soon as the account is open to start reducing interest immediately.

If you refinanced to release equity for an investment property or renovations, those funds are usually available within a day or two of settlement. Your conveyancer will confirm when the additional funds have been deposited into your nominated account. Keep records of how you use those funds, especially if they're for investment purposes, because the interest on that portion of the loan may be tax deductible.

Refinancing your Maylands home doesn't end when you receive approval. Settlement involves coordination between lenders, conveyancers, and insurers, and the more you understand about each step, the fewer surprises you'll face. Call one of our team or book an appointment at a time that works for you to talk through your refinance settlement and make sure everything is in place before your settlement date.

Frequently Asked Questions