Nearly all property goes up in value over the long term. If you’ve owned your home for some time, you may have built up substantial equity through capital growth. If you’ve made additional loan repayments, this will also increase your equity.
These days, lenders will allow you to borrow against the value of your home, enabling you to access a portion of the equity without having to sell your most valuable asset.
Accessing a portion of your equity opens up other avenues to help you build wealth, for example, buying an investment property, shares or units in managed funds.
Some people also use their equity for lifestyle purposes, like home renovations, or that overseas holiday they’ve always wanted to take.
The process for accessing your equity is the same as applying for any other home loan. Property Planning Australia will analyse your personal and financial circumstances and determine the amount you can comfortably repay.
If you’re accessing equity in your home to purchase an investment property, we will also look at your tax situation and holding costs to give you a clear indication of your cashflow. Depending on your situation, it may be possible to purchase without having to contribute any of your own funds.
Once your application has been approved, you’ll have access to a line of credit or pre-approval for a loan – at interest rates much lower than a credit card – to help you take advantage of investment opportunities when they arise.
Contact us to find out how you can access a portion of the equity in your home. One of our advisors will contact you shortly.