Borrowing to renovate

Renovating is a great way of adding value to your home. But like most creative projects renovating can be frustrating and stressful – that’s where a Loan Market mortgage adviser can help in getting the right finance the first time.


Depending on the size of your renovation project, you could need anything from a few thousand to hundreds of thousands of dollars. If you already have an existing home loan then a Loan Market Mortgage adviser will help you explore a number of competitive refinance options.

Renovations don’t always go smoothly, but we’ll make sure your finance loan does. Before you get started on your project, you will need to consider the features on your home loan. To give you greater control over your renovation you can choose from a range of financing options.

Redraw facility
A redraw facility allows you to access additional funds paid into your home loan if you need extra money, up to the amount of the additional repayments made. A redraw facility offers flexible access to funds when they are most needed. This is perfect for smaller projects.

Equity loans
Equity loans allow you to access the equity in your property to fund your renovation project. How much you can borrow is subject to the amount of equity you’ve built up in your property and other serviceability criteria, but as a guideline, even if you own your home outright you are likely to be limited to borrowing a maximum of 80% of the value of your property.

Loan top ups
A loan top-up allows you to increase the credit on your existing home loan to fund your renovation. It essentially taps into equity you have already built up in your property and extends some of that amount back to you, avoiding the expenses associated with acquiring additional finance through other sources. Unlike an equity loan, you are generally not able to continue to draw your interest back up to an agreed level – if you find you require additional funds you will need to apply for a further top-up loan. If available, there may be a minimum amount you can borrow, usually around $10,000.

Renovation/construction loans
For major work, such as a large ground floor addition, you could be looking at costs into the hundreds of thousands of dollars. Work on such a large scale may require separate finance in the form of a renovation or construction loan. These loans pay out funds for the construction or major renovation of your property in stages, rather than as a lump sum like a more traditional residential home loan.

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