Home loan increase

Pay for your next reno or big purchase by using the equity in your home, with a home loan increase.

Why increase
How to apply
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What is a home loan increase?

A home loan increase, also known as a top up, is one way to borrow extra money against your current property. If you've been reducing your home loan balance for a while, or the value of your home’s gone up, it lets you raise your home loan’s limit to access extra cash – as long as you can afford the additional repayments.

Why increase your St.George home loan?

Pay off other debts, at home loan rates

Option to consolidate debts – like your credit card and personal loan – into one increased home loan repayment, on a lower interest rate.

Use your equity to invest

You could increase your home’s value by renovating, buy shares or even pay a deposit on an investment property.

Combine or separate your repayments

Add your new loan amount to your current home loan repayments, or create a separate account on a different loan term.

Purchase at home loan interest rates

Pay for big ticket expenses, like a holiday or new car, then repay the additional funds in the short-term (not the life of the loan).

How do I apply for a St.George home loan increase?

1. Check your loan type

Home loan increases are available with variable home loans, but not Relocation Loans (bridging loan). You can top up a fixed rate loan by opening a separate loan account.

2. Estimate your usable equity

Usable equity = 80% of your home’s estimated market value, minus your current loan balance. If your new loan-to-value ratio (LVR) is more than 80%, you may need to pay lenders mortgage insurance.

3. Gather your income documents

You’ll need some proof of income, like payslips, so we know you’ll be able to afford the extra repayments.

4. Improve your repayment history

Before applying, ensure you’re up-to-date with all your repayments, as we’ll take repayment history into account.

5. Apply

Request a call back by choosing ‘increase my current home loan’ from the ‘I want to' drop down option. A home loan expert will call you in the next 2 business days, we may need to make a valuation of your home.

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Tell me more

You'll need 'usable equity'

Equity = property market value - loan balance

The equity in your home is the difference between the market value of your home and your current home loan balance. But you won’t necessarily be able to borrow against all of your equity.

Usable equity = 80% of property market value - loan balance

If you’re ahead on repayments, or your home’s value has gone up, you may have ‘usable equity’ to allow for a top up. We calculate usable equity as 80% of the value of your property, minus your loan balance.

Example

Let’s say Kim's property is worth $900,000 and he has a $400,000 home loan. We'll calculate 80% of his home's value: 80% of $900,000 is $720,000. We’ll then subtract $400,000 (loan amount) to get Kim’s usable equity of $320,000.

Eligibility: we’ll also want to be comfortable that borrowers can afford the extra repayments, so we’ll also consider Kim's income, debts, expenses and liabilities.

Kim applies for a $36,000 home loan increase to buy a new car. He’s approved and now owes $436,000 at home loan interest rates. NOTE: if Kim wants pay off his car in 3 years, he should increase his home loan repayments by $1000 a month plus interest ($36,000 / 3 years = $12,000 per year).

What’s the difference between my loan limit and loan balance?

Your loan balance is the amount you currently owe, and are paying interest on.
Your loan limit is the combination of your balance and available credit (when you’re on Principal & Interest repayments, your limit reduces over time).

If your home loan limit increase is approved, interest will only be charged on your balance, not the new limit you have in place.

Estimate your higher repayments

Advantages and considerations

Advantages

Home loans tend to have lower interest rates than other loans, plus it can be easier to manage one repayment.
You’ll only pay interest on your outstanding loan balance, not your higher loan limit.
Our application process can be simpler than applying for a new loan.
We’ve removed our top up fee.

Considerations

If you’re borrowing for an investment property, talk to your accountant about the potential tax implications.
More debt means more interest, and potentially higher home loan repayments.
There may be an associated valuation fee to top up. And if you top up by opening a separate loan account, some loans may come with an establishment fee. To find out, request a call back and one of our lenders will call you back to chat.
You'll only enjoy home loan interest rate savings (compared to higher short-term loan rates) if you repay the extra debt within a comparable term. Let’s say, for example, that you buy an electric car using a $50,000 home loan top up instead of a $50,000 3-year car loan. If you don’t accelerate your home loan repayments to repay the extra $50,000 within 3 years, your car purchase will be spread over the life of your home loan – and you’ll end up paying more interest.

Can I use my equity to create a separate loan?

Yes you can. Instead of increasing your current home loan balance, we could simply set up another home loan account for you. This lets you get features that your current loan might not have, like a fixed or variable rate, an offset account or a different loan term.

Depending on your situation, there may be an establishment fee on your extra loan. To find out, request a call back and one of our lenders will call you back to chat through your options.

Paying off other debts

Let’s say you owe money on a personal loan and credit card with another bank, plus a St.George home loan and new car loan. When you successfully apply to consolidate debts with a home loan top up, we'll use the additional funds to pay off all your non-home loan debt accounts for you – even the debts with other banks – then add the combined amount to your home loan balance.

Tips

Cancel the loans and credit cards you’ve paid out.
You'll only enjoy home loan interest rate savings (compared to higher short-term loan rates) if you repay the extra home loan amount within a comparable term. Let’s say, for example, that you consolidate a $50,000 3-year car loan into your home loan. If you don’t accelerate your home loan repayments to repay that $50,000 by year 3, your car purchase will be spread over the life of your long-term home loan – and you’ll end up paying more interest in total.
Do your best to pay off more than the minimum repayment amount, or you could end up paying compound interest (interest on interest). If you find yourself struggling, let us help you get back on top of things.

Renovating

You can use your top up to pay for a cosmetic renovation that costs $100k or less, like a whole new kitchen, solar panels or new floorboards.

If your reno is going to be over $100k, or includes structural changes like constructing an extra room, consider topping up with our building option. Available on our Standard Variable Rate Home Loan, this handy feature lets you draw down funds progressively as you meet each stage of your building milestones – so you’ll only be charged interest as your build progresses. We’ll set up a separate loan account for you, and we can manage the progress payments for you, giving you more control of your project.

Estimate your home rebuild costs

What can I use my home loan increase for?

How can I check my current home loan rate?

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Rates & calculators

Guides

Important information

Conditions, credit criteria, fees and charges apply. Based on St.George’s credit criteria, residential lending is not available for Non-Australian resident borrowers. Interest rates subject to change. Before making a decision, it’s best to read the terms and conditions.

Loan Accounts – Charges for specific services and accounts (PDF 43KB)

This information is general in nature and has been prepared without taking your objectives, needs and overall financial situation into account. For this reason, you should consider the appropriateness of the information to your own circumstances and, if necessary, seek appropriate professional advice.

Home loan increases, also known as top ups, are subject to approval.

Other fees and costs (PDF 43KB) may apply. Talk with one of our lenders about a potential property valuer fee, or a lending establishment fee when you top up via a separate loan account.