Thinking about your next property purchase but unsure how to free up the money? Releasing equity from your current home could be the key to moving forward faster.
Before you take the next step, it is important to know what you need to consider to make it work for you.
Get your property appraised to find out its true market value. This shows how much equity you have built up — the difference between your home’s value and what you still owe. Without knowing this, you will not know how much money you could access.
Look into cross-collateralising your properties. This means using both your current home and your new purchase as security to increase your borrowing power. It can help you borrow more but it is important to fully understand the risks. If property prices drop or you have trouble making repayments, both properties could be affected.
Ask yourself these important questions before moving forward
- What is my home really worth right now
- How much equity can I safely access
- Do I understand the risks of cross-collateralisation
- Will releasing equity affect my future financial plans
Releasing equity can be a smart way to fund your next purchase without using your savings. But it must be done carefully and with the right advice.
If you want to explore how much equity you can release and what it means for your next property, we offer free 15-minute chats to guide you through the process.