Home loan top-ups allow you to access the equity you have built up in your existing property by taking out additional lending secured against your home.
A top-up is set up as a separate loan, but it is secured by the same property as your existing mortgage. This can be used to help fund a range of goals, including renovations, purchasing a vehicle, education costs, green home improvements, or other major expenses.
The amount you may be able to borrow is based on the difference between your property’s current market value and what you still owe on your existing mortgage. In most cases, lenders will require at least 20% equity in your home before approving additional borrowing.
When applying for a home loan top-up, you can choose between fixed or floating interest rate options depending on your preferences and financial situation.
At Personalised Mortgages, our Mortgage Advisers are here to guide you through the process and help you understand whether accessing equity through a top-up is the right option for your goals. Get in touch with our friendly team today to discuss your options.
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Topping up your home loan can be a great way to fund both minor and major renovations to your property.
Depending on the scope of the work, lenders may request supporting information such as renovation plans, quotes or building contracts, and in some cases a council consent or an updated property valuation.
You can learn more about home loan top-ups for renovations here.
To calculate your home’s equity, divide your current mortgage balance by your home’s market value. For example, if your current balance is $200,000 and your home’s market value is $800,000, you have 25 percent equity in the home
In order to access a home loan top-up, most New Zealand lenders typically require you to have at least 20% equity in an owned-occupied property. This increases to 30% if topping up against an investment property.
Home loan top-ups can be an attractive way to borrow money, because they typically offer lower interest rates than a personal loan or credit card. At Personalised Mortgages we have built long-standing relationships with over 20 of New Zealand’s top lenders, so we are ideally placed to find you home loan top-ups at competitive interest rates.
A top-up is when you borrow money on top of your home loan utilising the existing equity in your home. Top-ups can be consolidated with your existing home loan or taken out as an additional loan.
The amount you can borrow with a home loan top up usually depends on what the top-up is for, how much of your home loan you’ve already paid off, your loan to value ratio (LVR), and whether you can afford the repayments once a top-up is added to your existing loan.
Whether you’re looking for expert mortgage advice to get you into your first home, or you’re upgrading, refinancing or looking for an investment property, our experienced team can help find the right solution for you.
