You might want to reduce your home loan limit to pay it off faster or to decrease your overall debt, which can help with future lending applications.
Most people reduce the limit on their home loan when they come into some extra money, like if they:
- sell an investment property
- receive an inheritance
- get a cash windfall, or
- sell other assets like shares or managed funds.
Important things to keep in mind:
- The amount you’d like to reduce your limit by needs to be available in your home loan account – it can’t be reduced by more than the loan has in surplus funds
- Once reduced, you won’t be able to access the funds anymore. If you need to access them again, we’ll need to do a new lending assessment
- If you reduce the limit on a fixed rate loan, fees might apply, but we’ll get in touch with you to discuss this after you make the request
- If the loan needs two (or more) to sign, all borrowers need to complete a request with the same details.