Your fixed rate period is ending, and the decision you make in the next 60 days will either support your next acquisition or lock you into another 2-3 years of limited flexibility.
Most Brisbane investors who came off fixed rates over the past 18 months defaulted to their existing lender's revert rate without reviewing their loan structure. That decision cost them access to offset accounts, equity release for deposits, and in some cases an additional 0.40% to 0.80% on their interest rate. When you're carrying a $600,000 loan, that margin compounds quickly.
The refinance process from fixed to variable isn't just about accessing a lower interest rate. It's about repositioning your debt to support what comes next, whether that's accessing equity for your next purchase, consolidating your portfolio under one lender with cross-collateralisation benefits, or moving to a loan structure that improves cashflow through offset and redraw features.
What Happens When Your Fixed Rate Period Ends
Your loan automatically moves to your lender's standard variable rate unless you take action before expiry. That revert rate is typically higher than the discounted variable rates available to new or refinancing borrowers, and it often lacks the features you need for portfolio growth.
Consider an investor who fixed a $550,000 loan on a Newstead apartment in early 2022 at 2.19% for three years. That loan expired in early 2025 and reverted to the lender's standard variable rate of 6.85%. A refinance to a discounted variable rate of 6.15% with offset access would have reduced their monthly repayment by approximately $230 while providing full offset functionality against their cash reserves. More importantly, the new loan structure allowed them to access $85,000 in equity growth to fund a deposit on a second property in Chermside without triggering a second fixed rate period that would have restricted future flexibility.
The moment your fixed rate expiry approaches is the moment to review your entire loan structure, not just your interest rate. The refinance process takes 4-6 weeks from application to settlement, so starting the conversation 90 days before expiry gives you time to compare offers, complete a property valuation if required, and move without rushing into a suboptimal structure.
Why Investors Are Switching to Variable Rate Structures
Variable rate loans provide access to offset accounts, unrestricted redraw, and the ability to make additional repayments without penalty. Fixed rate loans lock your rate but also lock your flexibility.
Offset accounts are particularly valuable for investors holding cash reserves for future deposits or managing rental income across multiple properties. A $50,000 balance in an offset account linked to a $600,000 loan at 6.20% saves approximately $3,100 per year in interest without triggering any tax implications. That saving is immediate and compounds over the life of the loan.
Variable rates also allow you to access equity without refinancing again. If your property has appreciated and you want to release equity to buy the next property, a variable rate loan with redraw or a pre-approved equity release structure lets you draw down funds within days rather than weeks. Fixed rate loans require a full refinance application to access equity, and in some cases you'll pay break costs to exit the fixed term early.
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The other consideration is rate movement. While fixed rates provide certainty, they also prevent you from benefiting if rates fall. A variable rate loan allows you to ride any future rate reductions without waiting for a fixed term to expire. For investors planning to hold properties long-term and build a portfolio, that flexibility outweighs the short-term certainty of a fixed rate.
How Equity Release Works During a Refinance
You can access equity when you refinance your investment property by increasing your loan amount up to your available equity and your lender's maximum loan-to-value ratio (LVR).
Most lenders will lend up to 80% of your property's current value without requiring lenders mortgage insurance (LMI). If your property has appreciated since you purchased or since your last valuation, the difference between 80% of the current value and your existing loan balance is your accessible equity.
In a scenario like this, an investor owns a Woolloongabba townhouse purchased for $480,000 in 2021 with a $410,000 loan. The property is now valued at $580,000. At 80% LVR, the maximum loan amount is $464,000. After repaying the existing loan of $395,000, the investor can access $69,000 in cash at settlement. That amount is sufficient for a 10% deposit on a $650,000 property plus settlement costs, all without selling or disrupting the existing tenancy.
The refinance application includes a property valuation, either a desktop valuation ordered by the lender or a full valuation if the property type or location requires it. Brisbane's inner-city apartment market and townhouse precincts like Stones Corner and Coorparoo have seen strong valuation outcomes over the past two years, which has made equity release a common driver of refinance activity in those areas.
You'll also need to demonstrate serviceability for the increased loan amount. Lenders assess your income, existing debts, and the rental income from your investment properties to determine how much you can borrow. If you're planning to expand your property portfolio, structuring your refinance to maximise serviceability while accessing equity is where experienced guidance makes a measurable difference.
Loan Structure Decisions That Affect Your Next Purchase
The loan structure you choose during a refinance will either support or constrain your next acquisition.
Principal and interest or interest-only, offset or redraw, single loan or split, cross-collateralised or standalone - each decision affects your cashflow, your serviceability, and your ability to borrow again within 12-24 months.
Interest-only loans reduce your monthly repayment and improve cashflow, which can increase your borrowing capacity for your next property. For an investor with a $500,000 loan at 6.20%, switching from principal and interest to interest-only reduces the monthly repayment by approximately $1,350. That difference improves your debt-to-income ratio and can add $100,000 or more to your borrowing capacity depending on your income and other commitments.
Offset accounts improve tax efficiency by reducing interest without reducing the deductible loan balance. Redraw facilities allow you to access funds you've paid ahead, but those withdrawals can be restricted by the lender and may complicate your tax position if you're mixing personal and investment purposes.
Cross-collateralisation, where multiple properties secure a single loan facility, can simplify portfolio management and reduce costs, but it also means you can't sell or refinance one property without your lender's consent across the entire facility. Standalone loans for each property provide more flexibility but may result in higher individual rates and more complex servicing.
The loan structure you choose should align with your acquisition timeline. If you're planning to buy again within 12 months, your priority is maximising serviceability and accessible equity. If you're consolidating and holding for 3-5 years, your priority is reducing loan costs and improving cashflow. A loan health check 90 days before your fixed rate expires gives you time to model different structures and select the one that positions you for what's ahead.
The Refinance Process and Timeline
The refinance process takes 4-6 weeks from application to settlement, and the steps are sequential.
You'll submit an application with your income verification, existing loan statements, property details, and a declaration of your financial position. The lender will order a property valuation, assess your serviceability, and issue a formal approval. Once approved, the lender's solicitor will prepare discharge and settlement documents, and your new loan will settle on an agreed date.
If you're accessing equity, those funds are released at settlement. If you're switching lenders, your existing loan is discharged and your new loan is registered on the property title. The process runs in parallel with your existing loan, so there's no gap in your repayment obligations.
Brisbane's inner-city precincts like Fortitude Valley, South Brisbane, and West End have high volumes of investor-owned apartments, and lenders are familiar with valuing and lending against those property types. Outer suburbs like Chermside, Coorparoo, and Kedron, where townhouses and older-style units dominate, may require full valuations rather than desktop assessments, which can add 7-10 days to the timeline.
Starting the process 90 days before your fixed rate expires means you can compare multiple lender offers, negotiate rate discounts, and move to settlement without defaulting to your existing lender's revert rate. If you wait until 30 days before expiry, your options narrow and you may need to accept a higher rate or less favourable loan features to meet the deadline.
When Staying with Your Existing Lender Makes Sense
Switching lenders isn't always necessary to access a lower interest rate or improved loan features.
If your existing lender offers a retention rate that matches or exceeds what you'd receive by refinancing elsewhere, and the loan structure already supports your portfolio goals, staying in place avoids the time and cost of a full refinance application.
Retention rates are negotiated directly with your lender, typically through a broker who can benchmark your current rate against market offers. Lenders would rather discount your rate than lose your loan to a competitor, particularly if you're a long-term customer with a strong repayment history and multiple properties financed through them.
That said, retention rates are often 0.10% to 0.20% higher than new customer rates, and they rarely include improved loan features like offset accounts if your current loan doesn't already have them. If you're also looking to access equity, consolidate debt, or restructure from interest-only to principal and interest (or vice versa), a full refinance with a new lender is usually the more effective option.
The decision to stay or switch should be based on the total outcome - rate, features, equity access, and loan structure - not just the interest rate in isolation. That's where a structured loan review provides clarity and removes guesswork.
Call one of our team or book an appointment at a time that works for you. We'll review your current loan structure, model your equity position, and identify the refinance strategy that positions your portfolio for the next acquisition.
Frequently Asked Questions
What happens to my loan when my fixed rate period ends?
Your loan automatically moves to your lender's standard variable rate unless you refinance or negotiate a new rate before expiry. That revert rate is typically higher than discounted variable rates available to refinancing borrowers and may lack features like offset accounts.
Can I access equity when refinancing from fixed to variable?
Yes, you can increase your loan amount up to 80% of your property's current value when you refinance, accessing the difference between that amount and your existing loan balance as cash at settlement. This requires a property valuation and serviceability assessment.
How long does it take to refinance from a fixed to variable rate loan?
The refinance process takes 4-6 weeks from application to settlement. Starting 90 days before your fixed rate expires gives you time to compare lenders, complete valuations, and move without defaulting to your lender's higher revert rate.
Should I switch to variable or fix again when my fixed rate expires?
Variable rate loans provide offset access, unrestricted redraw, and the ability to access equity without refinancing again, which supports portfolio expansion. Fixed rates provide certainty but limit flexibility, so the right choice depends on your acquisition timeline and cashflow priorities.
Do I need to switch lenders to get a lower rate when refinancing?
Not always. Your existing lender may offer a retention rate to keep your loan, but these rates are often slightly higher than new customer rates and may not include improved loan features. A full refinance with a new lender is usually more effective if you're also accessing equity or restructuring your loan.
