Increasing your home loan

Getting ready to renovate, buy a car or consolidate debt? If you’ve had your home loan for a while, it’s worth checking to see if there’s equity available in your property.

Instead of taking out a personal loan or credit card, you could apply for a home loan increase (also known as a home loan top up) and keep everything in one place. A home loan increase is when you increase the limit on your loan. If you have an existing Bankwest home loan, you can see the limit in the Bankwest App. Just log in, go into your home loan and tap ‘Manage’ in the menu.

Take advantage of a lower interest rate

Compared to a personal loan or credit card, the interest rate on your home loan is almost always lower. This means that you save on interest in the short term, but you need to take into account the life of the loan. Like with any loan, the longer the loan term, the more interest you’ll pay.

Bundle or split your repayments

With a home loan increase, you could either combine your new loan with your existing home loan repayments or keep it separate.

Bundle it with your existing repayments

If you’re renovating, upgrading, or purchasing an investment property, it might be better to combine it with your existing loan. Keep in mind that your repayments will increase, so it’s important to make sure you’re comfortable with the new repayments (just so it doesn’t take you by surprise).

Split repayments and keep it separate

If you’re getting the home loan to purchase a vehicle or consolidate debt, you might want to keep the loans separate and split your repayments. It means you can track repayments and set a shorter loan term – allowing you to pay it off sooner.

Get a sense for which option might work better for you and calculate your repayments.

Avoid annual and monthly fees

By increasing your home loan, you can avoid the fees that usually come with a personal loan or credit card. As it’s attached to your existing home loan, there aren’t any additional ongoing fees – even if you’re on the Complete Fixed or Complete Variable Home Loan Package.

Is there an application fee?

A one-off application fee may apply, but this depends on your current home loan product and how you would like to set up your repayments.

Will I have to pay for someone to value my property?

Typically, one standard property valuation is provided for free. It’s rare, but if your property is a bit more complex, there may be a fee to cover the excess valuation costs.

Will I have to pay Lenders Mortgage Insurance (LMI)?

If you’re borrowing more than 80% of your home loan, then LMI will apply - even if you’ve paid LMI in the past. It might seem like an extra cost, but it may be more cost effective than taking out a personal loan or credit card and you might be able to add it to the loan.

Review your loan at the same time

While you’re increasing your home loan, it’s also a good time to check you’re getting the most out of your product, interest rate, repayments and account features. You might want to switch to another product, add an offset account or even change your repayment frequency.

Ask an expert

Get in touch with one of our Home Finance Managers, and they'll respond within one business day.

Things you should know

The information contained in this article is of a general nature and is not intended to be nor should it be considered as professional advice. You should not act on the basis of anything contained in this article without first obtaining specific professional advice. Also to the extent permitted by law, Bankwest, a division of Commonwealth Bank of Australia ABN 48 123 123 124 AFSL / Australian credit licence 234945, its related bodies corporate, employees and contractors accept no liability or responsibility to any persons for any loss which may be incurred or suffered as a result of acting on or refraining from acting as a result of anything contained in this article.