Introduction
Separation is never easy. Alongside emotional challenges, managing a mortgage on a single income can feel overwhelming. But with lenders cutting fixed rates under 5% and regulators like ASIC pushing banks to treat borrowers more fairly, there has never been a better time to explore refinancing options.
Whether you’re in Sydney, Melbourne, Brisbane, Perth, Adelaide, Hobart, Canberra, or Darwin, refinancing after separation can provide the financial independence and stability needed to start fresh.
Why Refinancing on One Income is Different
When applying solo, lenders reassess:
- Serviceability – Your borrowing power is based only on your income.
- Debts and Expenses – Child support, legal fees, or shared debts are factored in.
- Credit Profile – A strong credit score is even more critical post-separation.
That’s why many single-income households assume they won’t qualify — but with the right strategy and a broker’s help, refinancing is often very achievable.
Current Market Conditions Favour Borrowers
- BOQ’s 4.89% two-year fixed rate remains the sharpest headline rate.
- NAB and ANZ offer fixed deals at 5.19%, and more lenders are expected to follow.
- ASIC’s probe into offset accounts ensures greater transparency for borrowers.
- The RBA is forecasting multiple cash rate cuts, which could push variable rates even lower.
This is welcome news for single-income households, as lower repayments mean greater financial breathing room.
How Much Could You Save?
On a $400,000 loan over 25 years:
- At 6%, repayments = $2,577/month
- At 4.89%, repayments = $2,315/month
That’s a saving of $262/month — or over $3,100 a year. For single parents or separated homeowners, those savings can be life-changing.
Refinancing Strategies for Separated Borrowers
1. Refinance Into Your Sole Name
Remove your ex-partner from the loan, giving you full control of the mortgage.
2. Use Equity to Buy Out Your Partner
If you want to keep the family home, equity can be released to fund the payout.
3. Switch to a Lower Rate Lender
With dozens of lenders offering sub-5% deals, refinancing can significantly reduce repayments.
4. Consider Fixed vs Variable
Fixed = certainty, variable = flexibility. Brokers often recommend splitting loans for balance.
5. Offset Accounts & Redraw
Ensure features like offset accounts are applied correctly — ASIC’s probe shows this can’t be taken for granted.
Capital City Realities
- Sydney: High mortgages mean even small cuts save thousands.
- Melbourne: Competitive market makes refinancing attractive.
- Brisbane: First home buyers moving solo benefit from affordability.
- Perth: Rising equity supports refinancing for sole borrowers.
- Adelaide: Lower balances = easier approvals on one income.
- Hobart: Offset accounts help reduce long-term costs.
- Canberra: Strong employment base boosts approval chances.
- Darwin: Regional lenders provide flexibility for single-income borrowers.
Real Client Story: Amanda in Perth
“After my divorce, I thought I’d have to sell the house. My broker helped me refinance into my own name at 4.95%. I kept the home, cut repayments by $280 a month, and finally felt financially independent.”
Why a Broker is Critical for One-Income Refinancing
- Lender Access – Brokers compare 50+ lenders, including those with flexible policies for single-income borrowers.
- Expertise – Understanding family law timelines, property settlements, and income types (like child support).
- Advocacy – Brokers ensure lenders consider your full financial picture.
- Support – Paperwork and negotiations are handled for you, reducing stress.
Risks of Staying Put
- Overpaying by thousands each year.
- Remaining financially tied to an ex-partner.
- Missing out on cashback offers and sub-5% rates.
- Risking credit issues if your ex fails to meet shared obligations.
Practical Steps You Can Take
- Check your current rate — if it’s above 6%, you’re likely overpaying.
- Gather financial documents — income, expenses, child support arrangements.
- Talk to a broker — assess your borrowing power and options.
- Act quickly — lender competition is heating up, but deals can disappear.
📅 Book Your Free, No-Obligation Chat
At Money Tree Mortgage Brokers, we specialise in helping separated borrowers achieve independence. From refinancing into your sole name to comparing 50+ lenders for the best deal, we’ll make sure your mortgage works for you — not against you.
