Home equity is the difference between your property's current value and what you still owe on your mortgage. It's the portion of your home you truly own—and it could unlock thousands in usable funds.
Quick example:
Most lenders let you access up to 80% of your property's value, minus what you owe. That's your usable equity and it could be more than you think.
Combine credit cards, personal loans and car loans into one lower-rate home loan repayment. You could save thousands in interest.
Fund that kitchen makeover, bathroom upgrade or extension. Smart renovations can add value while improving your lifestyle.
Use your equity as a deposit to build your property portfolio without saving separately.
Your equity could fund that overseas trip or vehicle purchase at lower rates than traditional finance.
Invest in your future with funds for university, courses or business growth.
You can use equity to buy an investment property or a second home without needing a deposit. This is usually done by borrowing against your equity through a refinance. This process, called a top-up loan, involves increasing your current home loan limit, giving you the money you need to buy the new property.
Alternatively, a line of credit lets you withdraw funds up to an approved limit based on your home equity, and you only pay interest on the amount you’ve actually withdrawn.
Here are five key factors that can influence the calculation of your home equity:
Equity is a measure of your financial health and your wealth. It can influence your ability to borrow, your net worth, and your financial security. Understanding and managing your equity is an essential part of personal finance.