Refinancing to access equity in your Melbourne home

What 'usable equity' means

Equity is your home's value minus what you owe. But lenders generally let you access up to 80% of the value without Lenders Mortgage Insurance — so usable equity is 80% of the value, less your current loan.

Example: a home worth $900,000 with a $400,000 loan has $320,000 in usable equity (80% of $900,000 = $720,000, minus the $400,000 loan).

Common reasons to release equity

• Renovations or extensions that add value to your home.
• A deposit for an investment property.
• Consolidating higher-interest debts into a lower mortgage rate.
• Funding a major expense at a home-loan rate rather than a personal loan rate.

The costs and considerations

Releasing equity increases your loan balance and repayments, so borrowing capacity is reassessed. Going above 80% of the value triggers LMI, which a broker will flag before you apply.

Switching lenders to release equity also brings the usual refinancing costs — see our full breakdown — though cashback often offsets them.

Borrow with a plan

Equity is powerful but it's still debt. Using it for things that build wealth — renovations or investments — usually stacks up; using it for everyday spending rarely does.

A XLOANS broker will model the new repayment and structure the loan (including offset or split options) so the equity release fits your bigger plan.