How to get a home equity loan
A home equity loan is borrowing against the part of your home you already own: its value minus what you owe, of which lenders will usually let you draw up to the point where the loan is 80% of the value. In Australia it is not a separate product so much as four ways of accessing the same equity: a top-up, a supplementary loan, a cash-out refinance or a line of credit. This guide covers how much you can borrow, which route suits which purpose, and what the lenders publish.
- Equity is value minus debt; usable equity is 80% of value minus debt. On a $750,000 home with $400,000 owing that is $200,000 (CommBank’s published example)
- Four routes: top-up (fastest, same lender), supplementary or split loan (keeps the original rate), cash-out refinance (new lender, new rate), line of credit (revolving, fewer lenders)
- Fixed-rate loans usually cannot be topped up without break costs; CommBank, IMB and ME publish this. Westpac opens a separate account instead
- Minimums are published at IMB ($10,000) and ME ($20,000); Westpac covers the first valuation and Bankwest one standard valuation
- Cheap per year, dear over 25 years: spread $30,000 over the remaining term and the interest can exceed a five-year personal loan (Unloan’s example)
WARNING: This comparison rate is true only for the example given and may not include all fees and charges. Different terms, fees, or other loan amounts might result in a different comparison rate. Comparison rates are based on a secured loan of $30,000 over 5 years for vehicle finance and $50,000 over 5 years for equipment finance, as required under the National Credit Code.
What is a home equity loan?
Your equity is the difference between what the property is worth and what you owe on it. A home equity loan turns part of that difference into cash by increasing your mortgage debt against the same security. Because it is secured by the house, it is priced at home loan rates, which is the attraction; because it is added to a 25 or 30 year loan, it can cost more in total than a dearer loan repaid faster, which is the trap.
Australian lenders rarely sell a product called a home equity loan. HSBC is one of the few, and it publishes it as an interest-only loan at 80% LVR or less. Everyone else delivers the same thing through one of four routes: a top-up or loan increase on your existing loan, a supplementary or split loan alongside it, a cash-out refinance to a bigger loan with a new lender, or a line of credit secured by the property. Equity release for retirees, which Moneysmart covers under reverse mortgages, is a different product with no monthly repayments and is not what this page is about.
How much equity can you borrow?
Lenders work from the loan-to-value ratio after the new borrowing, and the line most of them publish is 80%. Westpac states that most banks look for an LVR of 80% of the current value, so usable equity is 80% of the value minus the current balance. CommBank's published example: a home valued by the bank at $750,000 with $400,000 owing has $350,000 of equity, but 80% of $750,000 is $600,000, so the usable equity is $200,000. ING and NAB publish the same arithmetic on a $400,000 home with $220,000 owing: 80% is $320,000, usable equity is $100,000.
You can go above 80%. Westpac and Unloan both publish that a top-up or cash-out beyond 80% LVR is possible with lenders mortgage insurance, which is a one-off premium that the LMI calculator estimates. Two other limits bind before the LVR does: your income has to service the larger loan under the same buffered assessment as a new mortgage, and the lender's valuation, not your estimate, sets the value. The home equity calculator gives you the 80% and 90% figures from your own numbers.
Which route suits which purpose?
| Route | What it is | Suits | Watch for |
|---|---|---|---|
| Top-up (loan increase) | Your current lender increases the balance of your existing variable loan | Renovations, a car, debt consolidation, when you are happy with the lender and rate | Not on most fixed loans; repaid over the remaining term unless you ask for a shorter one; minimums of $10,000 (IMB) or $20,000 (ME) |
| Supplementary or split loan | A second loan account against the same property, alongside the original | Keeping the original rate and term intact; separating investment borrowing for tax | Its own rate, fees and term; ANZ's fine print cites a maximum term of 10 years on its supplementary loan |
| Cash-out refinance | A new, larger loan with a new lender that pays out the old one and releases the difference | When you would refinance anyway for a better rate, or your lender declines the increase | Discharge, registration and possibly break costs; assessed harder than a plain refinance |
| Line of credit | A revolving interest-only facility secured by the home | Irregular draws over time, usually for investors | Rate premium, no forced principal reduction, fewer lenders each year |
What do lenders publish on accessing equity?
Checked against each lender's published page on 20 September 2026; "Not published" means the page does not state it. Policies change without notice, so confirm with the lender or your broker before relying on them.
| Lender | LVR line | Minimum and eligibility | Valuation and fees | Other published terms |
|---|---|---|---|---|
| CommBank | Usable equity worked at 80% of value ($750,000 home, $400,000 owing, $200,000 usable) | Fixed and guaranteed-rate loans cannot be increased without breaking the contract | LMI may apply depending on the amount and the valuation | Top up online or with a Home Lending Specialist; restrictions on some loans may prevent extra repayments |
| Westpac | 80% of current value; beyond 80% possible with LMI | Increases on variable loans, not bridging loans or trustee (SMSF) loans; investors eligible; repayment history considered | Covers the first valuation if one is needed for a top-up | Increase on a fixed loan is set up as a separate account; supplementary loan option; top-up can be parked in the offset so interest accrues only on what is drawn |
| ANZ | LVR used to determine eligibility | Top up an existing variable loan subject to credit approval; minimum amounts vary by loan type | Fees and charges apply | ANZ Supplementary Loan as the equity route; fine print cites a maximum loan term of 10 years; call back in 1 to 3 business days |
| NAB | Usable equity at 80% ($400,000 home, $220,000 owing, $100,000 usable) | Not published | Valuation on request; existing customers check equity in the app | "Rule of four" for buying with equity; 20% deposit on the new property to avoid LMI |
| ING | Lends against 80% of current value | Not published | Asks for a new valuation before it sets the figure | Rule of thumb: borrow up to five times usable equity for an investment property |
| Bankwest | Depends on equity | Subject to existing lending criteria | One standard valuation free; a one-off application fee may apply depending on the product | Term can stay the same (higher repayment) or be reset; enquire in the app |
| Unloan | Cash-out at or below 80% LVR after drawdown ($800,000 home, $400,000 owing, $240,000 available); most lenders cap top-ups at 80% | Purpose asked; some lenders want quotes or evidence of debts | No fees of its own; government registration and discharge fees of $130 to $250 each, varying by state | Publishes the top-up vs personal loan interest comparison |
| IMB | Not published | Minimum top-up $10,000; not on fixed loans without breaking the term | Valuation may be required, a fee may apply | — |
| ME Bank | Up to 80% of the property value | Minimum top-up $20,000; not on fixed-rate or StandardME loans; funds cannot be used for business purposes | Valuation may be required, fees may apply | Broker-originated customers can apply through their broker |
| HSBC | Home Equity Loan at 80% LVR or less | Interest-only; with the $390 a year package | Valuation fee on standard valuations; variation fee for changes | One of the few branded home equity products |
| BOQ | Not published | Not published | Valuation fees may apply when applying using equity | Explains building equity through repayments and value growth |
What can you use it for, and what will the lender ask?
Renovation, a car, consolidating credit cards and personal loans, an investment property deposit, and large one-off costs are the purposes lenders name. Most ask what the money is for and some want proof: Unloan publishes that lenders may require quotes for a renovation or evidence of the debts being consolidated, and ME publishes that top-up funds cannot be used for business purposes. Westpac lists what a top-up application needs: updated income, savings, liabilities and assets, plus a current valuation. If the purpose is investment, keep the borrowing in a separate split so the interest can be traced for tax, and ask your accountant before settlement.
What about a line of credit home loan?
A line of credit is the original home equity product: a revolving limit secured by the house, interest-only, drawn and repaid as you like. Canstar still lists them and AMP, BCU, P&N Bank and Queensland Country Bank publish product pages, but the group shrinks each year. They carry a rate premium over a standard variable loan and nothing forces the balance down, which is why most lenders now steer borrowers to a top-up parked in an offset account. Westpac describes exactly that: transfer the whole top-up to the offset, and interest accrues only on what you withdraw. For an investor who wants a standing facility, a line of credit is still worth asking about; for anyone else, the top-up and offset does the same job for less.
When does a home equity loan not make sense?
When the purpose will not outlast the debt, when the increase pushes you above 80% and into LMI for a discretionary spend, and when the repayment leaves no buffer. Unloan's published comparison is the one to remember: $30,000 at 6% over the remaining 20 years costs about $21,600 in interest, against about $8,250 for the same money at 10% over five years. A shorter term on the top-up, extra repayments, or a supplementary loan with its own short term fixes that. A broker will tell you which lender allows which structure before you apply, and Your Finance Guide refers you to one licensed broker partner for that conversation; we do not lend or assess applications ourselves.
Equity and refinancing guides
The four routes, the costs and the calculators.
Home equity loan FAQs
What is the downside to a home equity loan?
Is it good to borrow against home equity?
How difficult is it to get a home equity loan?
How much would a $50,000 home equity loan cost per month?
Is a home equity loan the same as equity release or a reverse mortgage?
Can I get a line of credit against my home instead?
Does using equity change my home loan rate?
How long does it take to access equity?
Ready to use your equity?
Tell us the purpose and the amount, and we refer you to one licensed broker partner who checks your usable equity, compares a top-up, a split loan and a cash-out refinance on total cost, and lodges one application. Free for borrowers, no obligation.