Refinance Home Loan? Unlock New Property Fast (2026)

Are you considering leveraging the equity in your current home to finance the purchase of another property? Refinancing your home loan to buy another property can be a strategic financial move, allowing you to grow your investment portfolio or secure a dream holiday home. However, it's essential to navigate the complexities of refinancing with care, understanding the current market dynamics and the steps involved in this process.

Understanding Refinancing to Purchase Another Property

Refinancing involves replacing your existing mortgage with a new one, often to secure better interest rates or terms. When you refinance to buy another property, you essentially tap into the equity of your current home to free up funds for a new purchase. This can be an effective way to finance additional real estate investments without needing a substantial cash deposit.

Equity is the difference between your property's current market value and the remaining balance on your mortgage. For example, if your home is valued at $800,000 and you owe $500,000, your equity is $300,000. Lenders may allow you to access a portion of this equity, typically up to 80%, to use as a deposit for another property.

Current Market Rates, Requirements, and Options

As of 2026, Australia's property market continues to evolve, influenced by interest rate adjustments and economic factors. Interest rates for home loans typically range from 6.49% to 12%, depending on the lender and your financial profile. It's crucial to shop around, as rates can vary significantly.

Refinancing to purchase another property involves meeting certain eligibility criteria:

• Credit Score: A good credit score (usually above 650) is crucial to securing favourable refinancing rates.
• Income Verification: Stable, verifiable income to demonstrate your ability to handle additional loan repayments.
• Loan-to-Value Ratio (LVR): Ideally, an LVR of 80% or less on your current property to avoid lenders mortgage insurance.
• Comprehensive Financial Assessment: Including your current liabilities, credit card debts, and other financial obligations.

Let's compare some typical refinancing options available through our panel of 83+ lenders at Esteb and Co:

Steps to Refinance Your Home Loan to Buy Another Property

1. Evaluate Your Equity: Start by assessing your current home’s equity. Use recent property valuations and subtract your outstanding mortgage balance.
2. Check Your Credit Score: Obtain your credit report to ensure your score is in good standing. Rectify any discrepancies before applying.
3. Research Lenders: Explore the market and compare refinancing offers. Consider consulting with Esteb and Co to leverage our extensive panel of 83+ lenders for the best rates and terms.
4. Prepare Documentation: Gather necessary paperwork, including income statements, recent payslips, and tax returns.
5. Apply for Refinancing: Submit your application with the chosen lender, ensuring all information is accurate and complete.
6. Use Released Equity: Once approved, use the released equity as a deposit for your next property purchase.

Expert Tips and Considerations

• Consult with Experts: Engage with a mortgage broker to navigate the complexities of refinancing options and lender requirements efficiently.
• Consider Future Financial Obligations: Ensure you can manage the additional financial burden of a new property, including potential interest rate rises.
• Understand Tax Implications: Investigate any tax implications of owning multiple properties, as this can affect your overall financial strategy.
• Review Loan Terms Carefully: Pay attention to terms such as exit fees and early repayment penalties that may affect your financial flexibility.

Frequently Asked Questions

• Can I refinance if my credit score is low? It's possible, but you may face higher interest rates. Improving your credit score before refinancing can lead to better terms.
• How much equity can I access? Lenders typically allow access to up to 80% of your home’s equity, depending on your financial situation and the lender's policies.
• Will refinancing affect my credit score? Refinancing can temporarily impact your credit score, but timely payments on the new loan can improve it over time.
• Are there costs associated with refinancing? Yes, consider application fees, valuation fees, and potential exit fees from your existing loan.
• Is it a good time to refinance? It depends on your financial goals and market conditions. Consulting a mortgage expert can provide personalised advice.
• How long does the refinancing process take? Generally, refinancing can take anywhere from 4 to 8 weeks, depending on the lender and the complexity of your application.
• Can I refinance if I'm self-employed? Yes, but you may need to provide additional documentation, such as business activity statements and tax returns, to verify your income.