Whether to refinance a mortgage depends on the payback in months, worked out as "total refinancing cost ÷ monthly saving", and not only on the new bank's rate being lower. The costs include the original bank's early repayment penalty, the new bank's setup fee or handling fee, the land administration office's mortgage registration fee and certificate fee, and the scrivener fee. In addition, the central bank's real estate loan rules (in force from 2026-09-18) bar a refinancing from raising the loan amount through a new appraisal, and some borrowers may not have a grace period. This article uses one complete example: a balance of NT$8,000,000, 25 years remaining, and a rate falling from 2.5% to 2.1%, which makes the monthly payment about NT$1,590 lower. If total costs are NT$38,180, payback takes about 24 months; if a NT$48,000 penalty is added, about 54 months. The fees and rules below were all verified on 2026-11-07; bank rates and fees change, so please defer to the announcement at the time you apply.
What costs does refinancing involve
Refinancing means having a new bank lend the money to pay off the mortgage at the original bank. The property must have a mortgage right newly established in favor of the new bank, and the original bank's mortgage right must be cancelled, so the costs fall into four parts: "paid to the original bank", "paid to the new bank", "paid to the land administration authority" and "paid to the scrivener". The table lists the items for which a source was found; items for which no public figure was found are marked "not confirmed in this article" and no amount is given.
| Item | Paid to | How it is calculated (source) |
|---|
| Early repayment penalty | Original bank | Each bank's calculation base differs; see the three-bank comparison in the next section; if the contract has no lock-in period there may be none |
| Setup fee or handling fee | New bank | Bank A's page states a setup fee of NT$20,000, with an online application discount down to as low as 80% of the fee (8 折) (the page does not state a deadline for the discount); Bank C's fee schedule of 2025-08-20 shows, for owner-occupied cases, a handling fee of NT$8,000 (restricted early-repayment period of 3 years), NT$25,000 (restricted early-repayment period of 1 year) and NT$50,000 (no restricted early-repayment period) |
| Mortgage establishment registration fee | Land administration authority | Land law (《土地法》) Article 76: registration fee of one-thousandth of the declared land value or the value of the right; Bank A's page uses the "mortgage amount set" (抵押權設定金額) as the base |
| Certificate fee | Land administration authority | Article 2 of the fee standards for land or building right certificates and for applications to use cadastral data (《土地或建築改良物權利書狀及申請應用地籍資料規費收費標準》): NT$80 per other-rights certificate |
| Scrivener (land administration agent) fee, cancellation handling fee | Land administration agent (地政士) | Bank A has one page listing a scrivener fee of about NT$2,500 to NT$6,000, and another page of the same bank states NT$2,000 to NT$6,000; the handling fee for entrusting a scrivener with the cancellation is about NT$1,500 to NT$2,500; these are the reference ranges on that bank's pages, not statutory fees |
| Payoff fee (代償費) | Some banks | Bank A's page says that paying off the original mortgage is "generally about" NT$2,000, and explains that the bank offers a waiver of the payoff fee; this is the statement of a single bank's page, and whether other banks charge it and how much is not confirmed in this article, so please ask the new bank |
| Fire and earthquake insurance | Insurer | The risk management and insurance education portal (風險管理與保險教育推廣入口網) explains that buying residential fire insurance automatically includes the coverage of the basic earthquake insurance; whether after refinancing you must take out new insurance with the new bank as the mortgagee, and how much the premium is, are not confirmed in this article, so please confirm with the new bank and the insurer |
Take particular care over how the registration fee is calculated: Article 76 of the land law states the base as "the declared land value or the value of the right", while Bank A's page uses the "mortgage amount set" as the base. How the mortgage amount set relates to the loan amount is not confirmed in this article; please ask the new bank or the scrivener about the amount set in the contract. Bank A has two pages: one says "one-thousandth of the mortgage amount set", and the other says "usually 0.12% of the mortgage amount set" and gives an example of a mortgage amount set of NT$10,000,000 and a fee of NT$12,000. The two statements are inconsistent, so this article estimates throughout using the one-thousandth in Article 76 of the land law, together with the mortgage amount set as the bank's page describes it; the mortgage amount set in the example below is an assumed value.
The national laws and regulations database page for the land law shows its latest amendment date as August 7, 2024; the fee standards for certificates were amended on April 20, 2023.
Early repayment penalty: the calculation base differs among three banks
Many people only ask "what percent is the penalty", but the more important question is "multiplied by what amount". The table below shows the mortgage early repayment penalties as written on the public pages of three banks. The percentages of the three look close, but the amounts they are multiplied by differ, so the same loan balance can produce quite different results.
| Bank (see sources) | Calculation base | Within year 1 | Within year 2 | Within year 3 |
|---|
| Bank A | Principal repaid early (charged when the loan is fully repaid early and a repayment certificate or the cancellation of the mortgage right is requested) | 1% (within 12 months of the disbursement date) | 0.80% (months 13 to 24) | 0.60% (months 25 to 36) |
| Bank B | Cumulative principal repaid in the three months before the date of the cancellation application (excluding the normal amortization) | 2% (within one year, inclusive, of the first disbursement date) | 1% (over one year up to two years) | 0.5% (over two years up to three years) |
| Bank C | Loan balance (total amount drawn minus the total monthly principal payments already repaid) | 1% (within period 12, inclusive) | 0.75% (periods 13 to 24) | 0.5% (periods 25 to 36) |
The periods listed on all three pages stop at year 3. The differences are these: Bank B charges only on "the principal repaid extra in the three months before the cancellation", so if those three months were only normal amortization the result may be zero; Banks A and C charge on the principal repaid early or on the loan balance. In addition, Bank C's fee schedule shows that the handling fee is linked to the restricted early-repayment period: the handling fee is NT$8,000 for a restricted period of 3 years and NT$50,000 for no restricted period, which means that "no lock-in" does not mean cheaper, only that the cost is moved from the penalty to the handling fee.
Your actual penalty depends on the "loan note and agreement" (借據暨約定書) you signed. Whether partial early repayment is charged is written differently by each bank; Bank B's page says "early repayment within the agreed period does not require a penalty, but if the loan is repaid in full and the mortgage right is cancelled, a penalty must be paid". Refinancing usually cancels the original mortgage right (the last step in Bank A's process is cancellation), so the rules for "full repayment" mostly apply.
Central bank rules: is refinancing a new loan, and what about the grace period
The central bank (央行) rules on real estate mortgage lending by financial institutions (《對金融機構辦理不動產抵押貸款業務規定》) were published on 2026-09-17 and came into force on 2026-09-18. The text classifies home purchase loans to natural persons according to the borrower's houses and mortgages; the table most relevant to refinancing follows.
| Borrower situation (Point 4 of the rules) | Loan conditions |
|---|
| No mortgage but already owns a house | No grace period allowed |
| Already has one mortgage | No grace period allowed; the loan amount may not be increased with extra amounts under names such as renovation, working capital or other purposes; the maximum loan amount is 70% of the lower of the residence appraisal or the purchase price |
| Already has two or more mortgages | No grace period allowed; the maximum amount is 30% of the lower of the appraisal or the purchase price; the loan amount may not be increased with extra amounts under any other name |
| Purchase of a high-priced residence (NT$70,000,000 or more in Taipei City, NT$60,000,000 or more in New Taipei, NT$40,000,000 or more elsewhere) | Same as the 30% rule above |
The provisions list only these situations; a first-mortgage (第 1 戶) home purchase loan by someone who owns no house and has no mortgage is not within them. As for refinancing, the central bank text has three key points.
- Point 9, paragraph 2 of the rules: when a financial institution handles a refinancing or extension of the loans in the preceding paragraph, it may not raise the loan amount through a new appraisal. This means that in a refinancing you cannot raise the loan amount by having the new bank appraise the property again. The scope of this item is written in the text as "the loans in the preceding paragraph"; this article does not narrow it further.
- Q&A item 10: after a natural person takes out a restricted first-mortgage (第 1 戶) home purchase loan, additional borrowing is possible while the loan is outstanding. Other borrowers who take out a home purchase loan subject to the loan-to-value restriction can, in additional borrowing or refinancing within 3 years from the disbursement date, borrow more only for "the part of repayments exceeding equal-principal amortization" and "the difference where the original loan amount did not reach the percentage cap"; after 3 years they can borrow more, but the additional amount plus the original loan balance may not exceed the percentage cap. The above additional borrowing may not have a grace period, and the borrower must also undertake in writing that the funds will not flow into purchasing restricted real estate.
- Q&A item 10, point 4: the base for the percentage cap is, in principle, the lower of the original lending financial institution's appraisal or the purchase price; only where the lending institution truly cannot obtain the original lender's appraisal may it use instead the lower of the refinancing institution's appraisal or the purchase price.
How mortgages are counted: Q&A item 14 says the number of mortgages is determined by the number of collateral items, and one collateral item counts as one mortgage. Changing banks for the same house leaves the collateral as the same item.
The grace period is the part of this section most easily misunderstood. Bank A's page lists "the grace period applying anew" as one of the benefits of refinancing, but the central bank rules say "no grace period" for borrowers who own a house but have no mortgage, and for those who already have a mortgage. The central bank Q&A does not state word for word which category a borrower who "owns only this one house and simply changes banks" falls into; this article has not confirmed that point. Before applying, it is advisable to ask the new bank directly: "Under the central bank rules, which category does my refinancing fall into? May I have a grace period?" and to ask them for a written or verifiable answer.
How big a rate gap makes it worthwhile: formula and a complete example
The most direct method is the "monthly payment difference method":
- Using the same remaining term, calculate the monthly equal principal-and-interest payment at the old rate and at the new rate, and subtract to get "how much less is paid each month".
- Add up the one-time fees above to get the "total refinancing cost".
- Payback months = total refinancing cost ÷ monthly saving. The payback months must be fewer than the number of months you expect to keep this mortgage, otherwise refinancing makes no sense.
Example assumptions: a loan balance of NT$8,000,000, 25 years remaining (300 installments), equal principal-and-interest amortization, the rate fixed and unchanging, and an original rate of 2.5%. The one-time fees are assumed as follows: setup fee NT$20,000 (citing Bank A's page); mortgage amount set assumed at NT$9,600,000 (an assumed value); registration fee = 9,600,000 × one-thousandth = NT$9,600; certificate fee NT$80; scrivener fee assumed at NT$6,000; cancellation handling fee assumed at NT$2,500 (the last two taking the upper ends of the ranges on Bank A's page). The total is NT$38,180. Payoff fees differ from bank to bank and some banks may waive them, and no public figures were found for insurance related to refinancing; neither is included in this example, and actual costs depend on the quote you receive. Another case is where the original loan is still within its lock-in period: assume a penalty of 0.6% of the NT$8,000,000 principal repaid early (taking the rate for months 25 to 36 of Bank A in the table above, for illustration only), which is NT$48,000, for a total cost of NT$86,180.
| Rate change | Old monthly payment | New monthly payment | Monthly saving | Payback (no penalty, cost NT$38,180) | Payback (with penalty, cost NT$86,180) |
|---|
| 2.5% down to 2.1% (a difference of 0.4 percentage points) | NT$35,889 | NT$34,299 | NT$1,590 | About 24 months | About 54 months |
| 2.5% down to 2.25% (a difference of 0.25 percentage points) | NT$35,889 | NT$34,890 | NT$999 | About 38 months | About 86 months |
| 2.5% down to 2.4% (a difference of 0.1 percentage points) | NT$35,889 | NT$35,488 | NT$401 | About 95 months | About 215 months |
The table shows that when the rate gap is only 0.1 percentage points, the monthly saving is about NT$401 and payback takes about 95 months (no penalty) to about 215 months (with penalty); refinancing is usually not worthwhile in that case. With a gap of 0.4 percentage points and no penalty, payback takes about 24 months. Note three limitations. First, the monthly payment difference is a simplified method for a fixed rate; for a floating-rate mortgage, both the old and the new rate will be adjusted later. Second, the loan balance shrinks as you repay, so the effect of reduced interest narrows year by year, and you cannot treat the first year's saving as the same every year. Third, if the new bank lets you lengthen the term again, the monthly payment will be lower but the total interest may increase; in that case re-compare using the "same remaining term", to avoid mistaking "a longer term" for "a lower rate".
In addition, bank pages often list "the preferential rate for the first several periods" separately from "the rate afterward"; in the calculation, use the rate that applies over the longer period rather than looking only at the first segment. Comparing with the site's article on equal principal-and-interest versus equal principal repayment allows a further comparison of repayment methods. To check the building age of the house first, you can use the building age calculator.
The refinancing process and how long it takes
Bank A's refinancing page lists the process below; the actual operational details at each bank follow the new bank's explanations.
- Evaluate: first compare whether the interest saved by refinancing is higher than the cost of refinancing.
- Apply: online, or submitted with the help of a specialist.
- Loan review: the bank decides whether to approve based on your credit status, the condition of the property and so on, and decides the percentage, quota and rate.
- Signing and verification: confirm the approved rate, quota and other conditions.
- Mortgage right establishment: done at the land office, setting the new bank as the second-ranking mortgagee; a scrivener may be entrusted.
- Payoff and disbursement: the new bank helps repay the original bank's loan; after settlement, apply to the original bank for a repayment certificate.
- Cancellation: take the repayment certificate and related documents to the land administration authority to cancel the original bank's mortgage right; a scrivener may be entrusted.
On time, Bank A's application-process Q&A says "ordinary mortgages and refinancing generally take about 1 to 2 months from application to disbursement", and explains that the actual review time varies from case to case. This is that bank's explanation, not a general rule. Because the new and old loans overlap for a period during the process, you still have to keep paying the original loan during the refinancing; do not stop paying the original mortgage just because you have already submitted the application.
When refinancing may not be worthwhile
- You are still within the lock-in period, and the penalty plus the other costs stretch the payback months very long.
- The remaining loan term is short or the balance is small, so the total interest that can be saved is limited to begin with.
- The rate gap is very small, as in the 0.1 percentage point case in the table above.
- Your current loan is a government interest-subsidized loan. Take the Ministry of Finance treasury administration's (財政部國庫署) Q&A for the youth home-purchase preferential loan (youth loan 3.0, 青安 3.0) as an example: the scenario in item 23 is that a former owner's lease had not yet expired and a loan was first taken under another scheme of the handling bank and later changed to this loan; that item explains that this counts as a refinancing, and under item 16 the interest calculation after "reduced increases" and the government subsidy does not apply. Item 14 explains that the higher quotas for newlywed and child-raising families (NT$12,000,000 and NT$15,000,000) apply only to new applicants from August 1, 2026, and that for cases disbursed by July 31, 2026, the original quota may not be raised by switching, additional borrowing or refinancing to another bank. These two items are only the youth loan's own refinancing and quota rules; the treasury administration's Q&A does not explain whether the subsidy is retained after a youth loan is refinanced to another bank, so if you currently enjoy a government-subsidized rate, confirm with the handling bank before refinancing.
- You want to borrow more money. The central bank rules prohibit raising the amount through a new appraisal in a refinancing, and additional borrowing for different borrowers is subject to a 3-year restriction, so you cannot expect refinancing to necessarily bring you an extra sum.
To learn what other taxes and fees you must pay when buying a home, see Which taxes and fees apply when buying a home? Deed tax, stamp duty, registration fees and scrivener fees summarized; for the youth loan, see the site's article on the new youth home loan (新青安) calculations, but that article was written before youth loan 3.0, which has been accepting applications since 2026-08-01, so for the current conditions please defer to the Ministry of Finance treasury administration's page.
Frequently asked questions
Will refinancing be treated as a second mortgage?
Item 14 of the central bank Q&A only explains that the number of mortgages is determined by the number of collateral items, with one collateral item counting as one mortgage; it does not discuss how to classify the period when the old and new loans overlap during a refinancing, which this article has not confirmed. Under Point 4 of the rules, when a bank handles a home purchase loan it must query the credit information center (聯徵中心) and confirm the property tax consolidated records (財產稅總歸戶), and item 14 also requires the number of mortgages to be queried again before disbursement. Which category you will be placed in when refinancing, please ask the new bank, and ask them for a written or verifiable answer.
Can I borrow additional money at the same time as refinancing?
"Can" does not mean "definitely". Under item 10 of the central bank Q&A, a first-mortgage (第 1 戶) home purchase loan may be increased while it is outstanding; for other restricted borrowers, within 3 years they can only borrow more for the part of repayments exceeding equal-principal amortization and for the difference to the percentage cap; after 3 years they can borrow more but the total may not exceed the percentage cap, and the additional borrowing may not have a grace period, and the borrower must also undertake in writing the purpose of the funds. Point 9, paragraph 2 of the rules also prohibits raising the amount through a new appraisal.
How is refinancing handled for loans taken out before the new central bank rules took effect?
Q&A item 19: for home purchase loans handled before the rules took effect, a renewal at maturity or a refinancing at maturity must follow these rules for its loan conditions; where the original loan balance exceeds the percentage, an adjustment period of up to 1 year may be given for the difference, and you should consult the lending financial institution about the repayment method. Item 20: for refinancing cases where the original loan contract has not yet matured, until the original contract matures they are handled under the refinancing financial institution's credit rules, and after the original contract matures they are handled under these rules.
What should I ask the original bank before refinancing?
It is advisable to ask four things: one, whether the contract has a lock-in period and what the calculation base of the penalty is; two, how much it would cost to repay in full now; three, how long it takes to issue the repayment certificate; four, whether the cancellation of the mortgage right is to be handled by yourself or by a scrivener. These answers determine the two variables "penalty" and "time" in the example above.
Sources
- Central bank (中央銀行): rules on real estate mortgage lending by financial institutions (中央銀行對金融機構辦理不動產抵押貸款業務規定) (in force 2026-09-18, verified 2026-11-07) (in Chinese): Point 4 borrower categories and percentages, Point 9 refinancing may not raise the amount through a new appraisal, thresholds for high-priced residences
- Central bank (中央銀行): Q&A on the real estate mortgage lending rules (不動產抵押貸款業務規定問與答) (published 2026-09-17, verified 2026-11-07) (in Chinese): items 10, 14, 19 and 20
- National laws and regulations database (全國法規資料庫): land law Article 76 (verified 2026-11-07) (in Chinese): registration fee of one-thousandth of the declared land value or the value of the right
- National laws and regulations database (全國法規資料庫): fee standards for land or building right certificates and for applications to use cadastral data (土地或建築改良物權利書狀及申請應用地籍資料規費收費標準) (verified 2026-11-07) (in Chinese): certificate fee of NT$80 each
- Bank A: 中國信託 mortgage, refinancing costs and notes page (verified 2026-11-07) (in Chinese): setup fee, reference ranges for the scrivener fee and cancellation handling fee, mortgage right establishment process
- Bank A: 中國信託 mortgage, notes page (verified 2026-11-07) (in Chinese): early repayment penalty of 1%, 0.80% and 0.60%
- Bank A: 中國信託 mortgage, application process Q&A (verified 2026-11-07) (in Chinese): about 1 to 2 months from application to disbursement for ordinary mortgages and refinancing
- Bank A: 中國信託 mortgage, seven-step refinancing process page (verified 2026-11-07) (in Chinese): refinancing process, explanation of the payoff fee
- Bank B: 玉山銀行 FAQ, whether a mortgage can be partially repaid (verified 2026-11-07) (in Chinese): the difference in penalty between partial repayment and full repayment with cancellation of the mortgage right
- Bank B: 玉山銀行 FAQ, what is an early repayment penalty (verified 2026-11-07) (in Chinese): 2%, 1%, 0.5% and the calculation base
- Bank C: 台新銀行 consumer loan product fee schedule (page dated 2025/08/20, verified 2026-11-07) (in Chinese): handling fees of NT$8,000, NT$25,000 and NT$50,000 and penalties of 1%, 0.75% and 0.5%
- Risk management and insurance education portal (風險管理與保險教育推廣入口網): main contents and features of residential fire and basic earthquake insurance (verified 2026-11-07) (in Chinese): buying residential fire insurance automatically includes basic earthquake insurance coverage
- Ministry of Finance treasury administration (財政部國庫署): loan principles (youth loan 3.0) (verified 2026-11-07) (in Chinese): youth loan 3.0 accepts applications from 2026-08-01
- Ministry of Finance treasury administration (財政部國庫署): Q&A collection (youth loan 3.0) (verified 2026-11-07) (in Chinese): Q&A items 14, 16 and 23
