By taking out an equity loan, you’re allowing yourself to obtain a loan by using the equity as a collateral security, in simple terms equity is the difference between what you owe on the mortgage and the value of your home.
With an equity loan you can use it for multiple things, such as, renovation, investment in shares , to purchase another property or to refinance your mortage.
Which Lenders Offer an Equity Loan?
From lender to lender the interest rates and fees that can be offered for a basic home loan will vary, however all the major banks offer similar features for their equity loans. Some common basic loan products are:
- CBA– MAV package line of credit residential equity / MAV standard variable rate / MAV package 12 month discounted variable rate / Standard variable rate / Line of credit residential equity rate / MAV package 1 year guaranteed rate
- Rams- Line of credit professional pack / Line of credit / SmartWay / SmartWay professional pack
- Westpac- Premier advantage equity access loan / Equity access loan
- St George- Advantage home loan package portfolio loan / Advantage home loan package 1 year discount variable rate / Standard variable rate home loan / Portfolio loan
- Suncorp- Money manager asset line / Asset line
- ANZ– ANZ portfolio loan equity manager / ANZ portfolio home loan / Breakfree equity manager / Equity manager / Professional benefits equity manager
- NAB– Tailored home loan / NAB home equity line of credit / Introductory rate loan 3 year variable rate / National flexi plus / Amortising flexi plus
- And many more.
How does an Equity Loan Work?
An equity loan will allow you to have a line of credit on your mortgage up to a certain amount, it can be taken in full stages of as separate stages, and by having this it makes it a useful type of loan for renovating or investing purposes.
The loan amount that you will be able to borrow is determined by your situation, income and assets, as well as your existing debts.
If the equity loan is going to be used for an investment property, any current property values will be also assessed.
Who can Benefit from a Equity Loan?
If you’re ready to start renovations or purchase an investment property, then the equity loan is best for you, instead of saving for renovations or for a deposit which is known to take time.
It is essential to remember that all of your debts need to be carefully managed in order to maximise investment returns and to minimise risk. You can benefit from an equity loan if you:
- Own a property and are looking to purchase an investment property.
- Own a home and you would like to make renovations.
Please enquire online or call us on 1300 856 846 if you would like to talk with our mortgage broker who can give you expert advice on equity loan.