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What is Equity and How Can I Use It?

Equity is simply the difference between a property’s value and the current amount borrowed against it. In essence, you can actually borrow against the security of your property to use the funds ‘locked’ in your property(the equity).

But simply having equity does not mean you will be able to borrow against the full market value of your property! Other factors that will determine your borrowing power include:

  • The interest rate
  • Property prices and hence values
  • Your personal credit rating
  • Your income


The Power of Leverage

Understanding equity is important, because it is the basis of a concept called leverage. Leverage is the strategy that many successful entrepreneurs and investors have used to build their portfolios.

Here is a classic example of leverage: a property investor will use the equity in a piece of property he or she owns to get a loan to purchase another property. Once some of the debt has been paid off on the second property, the investor can use the equity to purchase a third investment, and so on.

So if you want to become a successful property investor, you will have to learn how to leverage equity. Equity can minimise risks, while increasing your potential borrowing power and potentially income; if it is used wisely.

The best way to start is to determine your borrowing power. Use this loan calculator to see if you are in a position to take advantage of your equity. Once you know how much equity you have available, you can then move on to consider the different ways to use the equity in your property or properties.



The Many Ways to Use Equity

Equity has many uses beyond property investment; you can use it for expanding your business, paying off other debt or making improvements to an existing home.

Establishing a relationship with Holiday Coast is the first step to accessing your property’s equity. And the most convenient way to start this relationship is to arrange an appointment with one of Holiday Coast’s Mobile Lending Specialists.

Our specialists will meet you at your home, or even your favourite coffee shop. Best of all, they are available to speak to you after business hours, so you will not have to take time off work.

Just call 1300 365 7 24 to arrange an appointment. You can also book an appointment with our mobile lending specialists online by clicking here.



Holiday Coast Can Help You Tap into Your Home’s Equity

Holiday Coast offers a wide variety of tools for tapping into the equity locked in your home, business or investment property. Our home loans enable you use your equity to pay for improvements and/or repairs , maybe an investment property, supporting a child into their own home or even the purchase of a personal asset eg a car, boat , bike or caravan.

We also have useful tools that allow you to compare home loans. If you want to go ahead and apply for one of our home loans, you can use our loan application form, or call 1300 365 7 24 to book an appointment with a mobile lender. Once you have a home loan in place, we will be happy to show you how you can use your equity to deliver your lifetime dreams and goals.


This article provides general information only and should not be relied upon as financial product advice.

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