Home equity calculator

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What different scores mean

9+

Excellent

These home loans offer low costs, coupled with a host of features, giving the best overall value.

7+

Great

These home loans may have slightly higher interest rates or fewer features but overall, a competitive offering.

5+

Standard

Usually the home loans would offer above average rates. They may still include some competitive features.

0+

Basic

Higher costs and/or fewer features.

To use Finder's simple equity calculator just enter an estimate of your property's current market value and how much is left on your home loan. You can also compare line of credit loans in the table below to start putting your equity to work.

How to calculate your equity

Calculating the equity in your home is easy. You just need to work out the difference between your property value and how much is left on your mortgage.

Now, you won't know the exact value of your home until you actually sell it. But you can estimate the value of your home by looking at a property listing site and checking recent sales in your suburb.

Make sure you look at similar properties to yours to get a clearer estimate. If you own a 3-bedroom townhouse with a small garden and a 1-car garage, look at recent sales of other 3-bedroom townhouses with the same features.

If you want a more accurate estimate, you can use a professional valuer (which your lender will usually organise). You will also need to find out your loan balance by contacting your lender or checking your home loan statement.

What is useable equity?

Finder's equity calculator gives you 2 numbers: your total equity and your useable equity. Your total equity is the entire value of the property minus your debts. This is the amount of money you'd end up with after you sold your property (minus any real estate agent commission and other selling costs).

Useable equity is how much of your home's equity a lender will let you borrow. This matters if you're trying to borrow some extra money with a home loan top up or line of credit. Most lenders typically let you borrow around 80% of your home's equity instead of the full amount. But some lenders may be more conservative with this, restricting you to 70% of your total equity.

How to access your equity

Here are 3 simple ways via which you can access your home equity:

• Redraw. The simplest way to build your home equity is to make payments above your minimum monthly repayments. You can then access a portion of this equity by redrawing the extra funds. Redraw restrictions may apply depending on your lender. Learn more about mortgage redraw.
• Refinancing. If you refinance your home loan to a new one you can apply for a credit increase with your bank. When the new loan is approved, the extra money is added to your loan balance.
• Home equity loan/line of credit loan. A line of credit is a loan which extends you a set credit limit based on your equity. These loans allow you to withdraw small amounts or the whole balance whenever you like, and charge interest only on the amounts withdrawn.

What can I use my home equity for?

If you have equity in your property you can borrow some of this equity using a line of credit loan. Here are some things you can do using your home equity:

• Finance home renovations. You can use your home equity to fund some renovations to improve your place. You may also use the equity to apply for an additional loan and use the funds to purchase a new car or other investments.
• Fund a purchase or holiday. You can use your equity for any purpose, such as buying a car or taking a holiday.
• Building wealth. Unlocking the equity in your home can help you improve your lifestyle by enabling you to invest in property. Equity in your home can be used as security for property investment, enabling you to accumulate wealth.

Using your equity means paying interest and growing your debt

When calculating how much home equity you can access there are a few factors you should take into consideration:

• Increase in monthly interest. Accessing your home equity to get an additional loan or credit increase will increase the amount you owe. This will most likely end up increasing the amount you pay in monthly interest.
• Increase in monthly payments. Using your equity can increase your outstanding mortgage amount without increasing your loan repayment term. This will mean that your minimum monthly repayments can rise, so proper budgeting is required so as to avoid financial difficulties.
• Increase in your loan to value ratio (LVR). If your property value hasn’t increased significantly when you get a redraw or credit increase, your LVR may increase, forcing you to take out lenders mortgage insurance (LMI) that will further increase your loan amount.

What if I don't have much equity?

If you've just started making repayments on your loan you probably don't have much equity. As you repay the loan over time you'll build this equity.

Borrowers with low deposit home loans have the least equity. When you start a home loan, the deposit is the total amount of the property you actually own. So if you had a 10% deposit then you'd only have 10% equity at the start.

You can build equity by making extra repayments or putting extra money in an offset account. Over time, if property prices grow, this will also increase your equity. This is because while your home loan should shrink over time, any increase in the value of the home is entirely your money.

More helpful articles

• How to use your equity to buy a second property
• How to invest in property using equity and a line of credit

Compare line of credit home loans

1 - 6 of 6

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Name	Finder Score	Interest Rate p.a.	Comparison Rate p.a.	Fees	Monthly Payment
Commonwealth Bank Viridian Line of Credit Principal & InterestInterest only20% min. deposit Commonwealth Bank Viridian Line of Credit Principal & InterestInterest only20% min. deposit Details Fees Pros & cons Product Name Commonwealth Bank Viridian Line of Credit Interest Rate Type variable rate Repayment Type Principal & Interest Interest Only Interest Rate p.a. 10.28% Comp. Rate p.a. Maximum Loan Term Maximum LVR 80% Loan Redraw Facility Yes Offset Account No Split Loan Facility No Fixed Interest Option No Loan Portable No Extra Repayments Yes Application Fee $0 Lender's Legal Fee $0 Valuation Fee $0 Ongoing Fees $395 p.a. Settlement Fee $200 Discharge Fee $350 Pros Redraw Facility. Flexible spending and repayment options. Cons Establishment fee of $600. There is a $12 monthly service fee. There is a $200 settlement fee. A discharge fee of $350 applies when you close this loan.	Finder score 3.2 Basic	Interest Rate 10.28%	Comparison Rate	Fees Application: $0 Ongoing: $395 p.a.	Monthly Payment $1,349	Contact Broker Compare
Well Money Equity Plus Principal & Interest40% min. depositOwner-occupierOffset account Well Money Equity Plus Principal & Interest40% min. depositOwner-occupierOffset account Details Fees Pros & cons Product Name Well Money Equity Plus Interest Rate Type Variable rate Repayment Type Principal & Interest Interest Rate p.a. 6.16% Comp. Rate p.a. 6.19% Minimum Loan Amount $200,000 Maximum Loan Amount $2,000,000 Maximum Loan Term 30 years Maximum LVR 60% Loan Redraw Facility Yes Offset Account Yes Split Loan Facility Yes Fixed Interest Option No Loan Portable Extra Repayments Yes Application Fee $250 Lender's Legal Fee $385 Valuation Fee Up to $300 free Ongoing Fees $0 p.a. Settlement Fee $0 Discharge Fee $300 Pros Competitive variable interest rate 100% offset account Cons You need a large deposit to get this loan This loan has a couple of fees	Finder score 8.9 Great	Interest Rate 6.16%	Comparison Rate 6.19%	Fees Application: $250 Ongoing: $0 p.a.	Monthly Payment $916	Continue Compare
Greater Bank Ultimate Line of Credit Home Loan Principal & InterestInterest only10% min. depositOwner-occupier Greater Bank Ultimate Line of Credit Home Loan Principal & InterestInterest only10% min. depositOwner-occupier Details Fees Pros & cons Product Name Greater Bank Ultimate Line of Credit Home Loan Interest Rate Type variable rate Repayment Type Principal & Interest Interest Only Interest Rate p.a. 8.10% Comp. Rate p.a. Maximum Loan Term 30 years Maximum LVR 90% Loan Redraw Facility Yes Offset Account No Split Loan Facility Yes Fixed Interest Option No Loan Portable No Extra Repayments Yes Application Fee $500 Lender's Legal Fee $0 Valuation Fee $0 Ongoing Fees $0 p.a. Settlement Fee $180 Discharge Fee $300 Pros Cons	Finder score 6.1 Standard	Interest Rate 8.10%	Comparison Rate	Fees Application: $500 Ongoing: $0 p.a.	Monthly Payment $1,112	Continue Compare
AMP Bank Professional Package Line of Credit Interest only20% min. depositInvestmentOffset account$100K to AMP Bank Professional Package Line of Credit Interest only20% min. depositInvestmentOffset account$100K to Details Fees Pros & cons Product Name AMP Bank Professional Package Line of Credit Interest Rate Type variable rate Repayment Type Interest Only Interest Rate p.a. 7.19% Comp. Rate p.a. 7.43% Minimum Loan Amount $100,000 Maximum Loan Amount $499,999 Maximum Loan Term 30 years Maximum LVR 80% Loan Redraw Facility Yes Offset Account Yes Split Loan Facility Yes Fixed Interest Option No Loan Portable Yes Extra Repayments Yes Application Fee $0 Lender's Legal Fee $295 Valuation Fee Any valuation costs in excess of $550 Ongoing Fees $349 p.a. Settlement Fee $0 Discharge Fee $390 Pros $0 application fee100% offset account Cons There's an annual fee of $349 A $390 discharge fee applies when closing the loan	Finder score 8.1 Great	Interest Rate 7.19%	Comparison Rate 7.43%	Fees Application: $0 Ongoing: $349 p.a.	Monthly Payment $1,018	Contact Broker Compare
Hume Bank Line of Credit Loan Interest only20% min. depositOwner-occupier Hume Bank Line of Credit Loan Interest only20% min. depositOwner-occupier Details Fees Pros & cons Product Name Hume Bank Line of Credit Loan Interest Rate Type variable rate Repayment Type Interest Only Interest Rate p.a. 9.25% Comp. Rate p.a. Maximum Loan Term 25 years Maximum LVR 80% Loan Redraw Facility No Offset Account No Split Loan Facility Yes Fixed Interest Option Yes Loan Portable Yes Extra Repayments Yes Application Fee $600 Lender's Legal Fee $0 Valuation Fee $0 Ongoing Fees $0 p.a. Settlement Fee $0 Discharge Fee $0 Pros Cons	Finder score 4.6 Basic	Interest Rate 9.25%	Comparison Rate	Fees Application: $600 Ongoing: $0 p.a.	Monthly Payment $1,235	Contact Broker Compare
BCU All-In-One Line of Credit Principal & InterestInterest only21% min. depositOwner-occupier BCU All-In-One Line of Credit Principal & InterestInterest only21% min. depositOwner-occupier Details Fees Pros & cons Product Name BCU All-In-One Line of Credit Interest Rate Type variable rate Repayment Type Principal & Interest Interest Only Interest Rate p.a. 7.74% Comp. Rate p.a. Maximum Loan Term Maximum LVR 79% Loan Redraw Facility No Offset Account No Split Loan Facility Yes Fixed Interest Option No Loan Portable Yes Extra Repayments Yes Application Fee $0 Lender's Legal Fee $0 Valuation Fee $0 Ongoing Fees $0 p.a. Settlement Fee $0 Discharge Fee $0 Pros Cons	Finder score 6.6 Standard	Interest Rate 7.74%	Comparison Rate	Fees Application: $0 Ongoing: $0 p.a.	Monthly Payment $1,075	Continue Compare

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What is Finder Score?

The Finder Score crunches 7,000 home loans across 120+ lenders. It takes into account the product's interest rate, fees and features, as well as the type of loan eg investor, variable, fixed rate - this gives you a simple score out of 10.

To provide a Score, we compare like-for-like loans. So if you're comparing the best home loans for cashback, you can see how each home loan stacks up against other home loans with the same borrower type, rate type and repayment type. We also take into consideration the amount of cashback offered when calculating the Score so you can tell if it's really worth it.

Read the full Finder Score breakdown

Written by

Richard Whitten

Editor

Richard Whitten is a money editor at Finder, and has been covering home loans, property and personal finance for 6+ years. He has written for Yahoo Finance, Money Magazine and Homely; and has appeared on various radio shows nationwide. He holds a Certificate IV in mortgage broking and finance (RG 206), a Tier 1 Generic Knowledge certification and a Tier 2 General Advice Deposit Products (RG 146) certification. See full bio

Richard's expertise

Richard has written 562 Finder guides across topics including:

• Home loans
• Property
• Personal finance
• Money-saving tips