Is accessing equity the same as getting a second mortgage?

Not exactly. A second mortgage is an additional loan from a different lender. Equity access typically involves refinancing your existing loan to a higher amount with the same or new lender, which is generally simpler and cheaper.

What are the risks of accessing equity?

The main risk is increased debt secured against your home. If you can't meet repayments, you could lose your property. Only access equity for purposes that improve your financial position or have clear repayment plans.

What are the different types of equity release options available in Australia?

In Australia, homeowners can access their home equity through various options such as home equity loans, lines of credit, and cash-out refinances. For example, a cash-out refinance allows you to replace your existing mortgage with a larger one, withdrawing the difference as cash. As of March 2026, interest rates for these products typically start from around 5.99% p.a., subject to your credit profile. To explore which option suits your needs, visit our equity release options guide.

How does refinancing to access equity impact my mortgage repayments?

Refinancing to access your home equity involves replacing your current mortgage with a new loan, often resulting in different repayment terms. For instance, extending your loan term may lower your monthly repayments but increase total interest paid over time. With current rates around 5.99% p.a., it's important to assess whether the new repayment structure aligns with your financial goals. Use our mortgage repayment calculator to estimate your new payments and consult with a mortgage broker to determine the best approach for your situation.

refinanceJan 2026

Accessing Your Home Equity

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Your home equity—the difference between your property's value and what you owe—can be a powerful financial resource. Understanding how to access it safely is key to smart wealth building.

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What is Usable Equity?

Most lenders allow you to borrow up to 80% of your property value (to avoid LMI). Usable equity = (Property Value × 80%) - Current Loan Balance

Example: Property worth $800,000, loan of $400,000
Usable equity = ($800,000 × 80%) - $400,000 = $240,000

Equity Access Methods

Cash-Out Refinance

Increase your loan and receive the difference as cash. Interest applies to the entire loan.

Line of Credit / Equity Loan

A separate credit facility secured against your property. Only pay interest on what you use.

Split Loan

Separate the equity portion from your main loan for different purposes (e.g., investment vs personal).

Common Uses for Equity

Investment property deposit
Home renovations
Share portfolio or managed funds
Business investment
Debt consolidation

Frequently Asked Questions

Available equity = (Current property value × 80%) - Outstanding loan balance. For example, a $700,000 home with $300,000 owing: ($700,000 × 0.80) - $300,000 = $260,000 usable equity. A valuation may be required to confirm current value.

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