What is an Equity Loan in Simple Terms? 

An equity loan is when you use the difference between what you owe on your mortgage and the value of your home. It’s like tapping into the value your home has gained. 

This loan is flexible, meaning you can use it for different things, like buying another property, renovating your home, refinancing your mortgage, or investing in shares. 

Why Do Banks Have Concerns About Equity Releases? 

Banks are cautious about how much money you take out using equity because it’s riskier than a regular home loan. They want to know what you’ll do with the money, and their rules for approval are stricter. 

Which Lenders Offer Equity Mortgages? 

Major banks can provide equity loans, but there are also non-conforming and specialist lenders who are more lenient with equity release. Talking to a mortgage broker can help you find the best lender for your equity loan. 

Types of Cash Loans Available: 

• Lump Sum Cash Type: You get a lump sum for an investment or project and start paying interest right away. 
• Line of Credit: You only pay interest on the part of the loan you’ve used. 

You can even refinance your entire loan to access the equity in your home. 

How Can Equity Finance Benefit Me? 

Many Australians spend years saving for a deposit to renovate their home or buy an investment property. But what if there was a more flexible way? 

With an equity loan, you can start renovations or buy an investment property sooner, without waiting years to save up. It’s more convenient. But remember, managing debts carefully is crucial to make the most of your investments and minimize risks.