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Refinancing your government home loan

If you have a Queensland Government home loan, you may be able to pay it out using a loan from another lender, like a bank (what’s known as refinancing).

Among the reasons you may want to refinance your loan are to:

  • get better loan terms or features (e.g. a lower interest rate)
  • use the equity in your home to pay for a home renovation or other large purchase
  • apply for a new loan solely in your name if you’re separating from your partner and want to keep the home.

Whatever your situation, refinancing is a way to make sure your home loan is suited to your financial needs.

How refinancing works

Once you’ve chosen a new lender to refinance your home loan, the next steps are:

1. Lodge an application for your new loan

The new lender (or your mortgage broker) prepares all the paperwork you need to read and sign. Your property may also need to be revalued.

2. Discharge your existing loan and settle your new loan

Once you’re approved for your new loan, you contact us to let us know you’d like to pay out—discharge—your existing government home loan. You must give us at least 10 business days’ notice.

When we know the exact date of settlement, we give you a final payout figure. Your new lender then pays out your old loan and registers a new home loan for you.

3. Continue making repayments on your new loan

You receive documentation for your new loan and begin making repayments on it.

If you’re a Pathways Shared Equity Loan or Rental Purchase Plan customer

If you’re paying or have paid off a loan for a share of your property and you want to refinance the loan, your new loan must be big enough to:

  • pay off any money you still owe on your existing loan

and

  • buy our share of the property based on its current market value.

Unlike other customers, Rental Purchase Plan customers can refinance not only through a private lender (e.g. a bank) but also a government Queensland Housing Finance Loan.

Home improvement credit

If you refinance your Pathways Shared Equity Loan or Rental Purchase Plan loan, we may give you a credit for any structural improvements you’ve paid for that increased the property’s value.

For example, if you own 60% of the property and your improvements increased its value by $15,000, we may credit you our share of the increased value—40%, or $6,000.

The amount by which the improvements increased the property’s value will be determined by an independent valuer.

Regular maintenance and repairs are not considered to be home improvements.

Taking out a second mortgage

You cannot increase the amount of your Queensland Government home loan to, for example, fund a home renovation or other large purchase.

So, to borrow more money against the equity in your home, you would need to either refinance your home loan (see above) or get a second mortgage through another lender.

Permission for second mortgage

You must get our permission, as your existing lender, to register a second mortgage on the title of your property.

The only exception is if your home loan is secured by a second mortgage in the name of the Queensland Public Trustee. In that case, our permission is not needed.

More information

Last updated:
22 April 2025
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