Home equity is the difference between your property value and the debt secured against it. It is not the same as an approved borrowing amount. A lender still needs to accept the property value and assess whether you can afford the proposed loan.
Prepared for Reduce My Repayments by Monet Finance · Published 5 October 2026 · General information for Australian homeowners
Work out the starting point
Use your current mortgage statement rather than the original loan amount. For the property value, treat online estimates and agent appraisals as a starting point. The lender may use a different valuation. Include other loans secured against the property so the starting calculation does not overlook an existing obligation.
A worked example, not a lending limit
Illustration only: a home worth $800,000 with a $500,000 mortgage has $300,000 of total equity. At an assumed 80% loan-to-value ratio, total borrowing would be $640,000, leaving $140,000 before fees and other secured debts. The 80% figure is an example, not a promise of lender policy or your eligibility. Income and expenses could support much less borrowing.
Ask how the new structure will work
Ask what the mortgage balance becomes after debt payouts and any financed fees. Then ask what remains in the existing mortgage portion and what is allocated to the consolidated portion. Discuss the repayment target for each. Increasing your mortgage to clear another debt changes where the debt sits; it does not turn equity into free money.
Consider tomorrow as well as today
Think about upcoming parental leave, a move, retirement or a change in work. A structure that fits today may need a different payoff plan if your income will change. Leave room in the conversation for those plans, even if they seem years away.
What to prepare
- Current mortgage and other secured-loan balances.
- Estimated property value and any recent appraisal.
- Total debts you want reviewed.
- Known changes to income or household expenses.
Your questions answered
Can I use all the equity?
Do not assume that. Available borrowing depends on valuation, lender limits, costs and affordability.
What does LVR mean?
Loan-to-value ratio is the loan amount divided by the property value, expressed as a percentage.
Can a valuation change my options?
Yes. A different accepted property value changes the equity and LVR calculation.