A couple in Concord had owned their home for eleven years, owed far less than it was worth, and had almost nothing in a savings account.
Release it. A separate loan split against your home, up to about 80 per cent of its value less what you owe, funds the deposit and costs, and the investment gets its own standalone loan.
Keeping the two loans separate keeps the investment debt clear and each property free to sell or refinance alone.
Part of the investment property loans guide.
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Book my free callHow much equity could you use?
For upgraders and investors, how much of your home could work as a deposit.
That usable equity could work as a deposit on an investment property or renovation, structured so your properties aren’t tied together unnecessarily.
Usable equity assumes lending to 80% of your home’s value against your current loan. Lender policy and serviceability decide the real figure.
Confirm your numbers.
Charles and the team recently assisted us with a refinance of our investment property. Recommend Charles and the team to all
Charles looked after us really well and his knowledge gave us the confidence to purchase our property. He wasn’t pushy and always ensured we felt comfortable with the repayments.
Charles went above and beyond to help us secure our home loan. He worked hard to find the best option for us and kept us updated throughout the whole process. His knowledge of the lending market was impressive and he made everything straightforward.
Charles Touma, Mortgage Broker.
Three things needed to line up. The valuation, since the release amount is calculated from the lender's assessed value, not the owner's estimate, and the equity calculator gives a first read but a valuer decides.
Serviceability across two properties, where the lender counts the projected rent conservatively and applies an assessment buffer to both loans. And structure: the released funds need to sit in their own split, used solely for the investment, so the purpose of each dollar is traceable.
Usable equity at a realistic valuation, typically up to 80 per cent of value less the existing debt. Whether one lender should hold both properties or whether splitting across two is safer, because cross-securitised loans are simple to set up and awkward to separate later.
How the rental income will be treated, discounted at each lender's own rate. And the structure conversation before any application, since the split between deductible and non-deductible debt is decided by how the funds are drawn, not by intention.
Using equity means the home carries risk for the investment. If the investment underperforms, the exposure sits against where you live, which is the trade-off nobody enjoys stating. Our equity release guide and investment lending guide cover both halves.
Buffers matter more here than on a first purchase: vacancy, rate movements and maintenance all land on a household already carrying two loans.
Structuring is also an accountant's conversation as much as a broker's, because deductibility follows the use of the funds, and getting that wrong is expensive and difficult to correct.
If you have owned for years, run the equity numbers before you assume you need to save a cash deposit.
And have the structure conversation before the application rather than after settlement, because the split between deductible and non-deductible debt is set by how the money is drawn, and it is far cheaper to design than to repair.
The lender releases part of the value already in your home, which becomes the deposit on the investment purchase, usually structured as a separate loan split. Using equity explains usable versus total equity.
Partly. Lenders discount rent for vacancy and costs before it services the loan, so the figure that helps your borrowing is lower than the rent itself.
Generally the cleaner structure keeps each property securing its own loan. Structure is a decision made at the start; unwinding it later is harder.
Scenarios like this one raise plenty of follow-up questions, and our investment loan FAQ answers many of them.
Thirty minutes with Charles: what your equity could release, what two loans would cost, and how to structure it so the tax position stays clean.
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This is an illustrative example scenario, not a description of a specific client and not a testimonial. The figures are realistic but rounded, no lender is named, and no outcome is promised, every application is assessed on its own facts. General information only, not credit or financial advice.
