What can I use a line of credit home loan for?

A line of credit home loan can be an investment in your financial future.

A line of credit home loan uses the equity in your home to offer you a fixed credit limit. The funds freed up by a line of credit can be used for any purpose, but savvy homeowners can utilise these loans to help build wealth.

Compare line of credit home loans

Rates last updated January 19th, 2019
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Offset account
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Name Product Interest Rate (p.a.) Comp Rate^ (p.a.) Application Fee Ongoing Fees Max LVR Monthly Payment Short Description
4.24%
$0
$349 p.a.
80%
Low fee line of credit loan with package benefits.
4.39%
$0
$15 monthly ($180 p.a.)
90%
A low rate line of credit with low ongoing fee.
5.78%
$0
$395 p.a.
90%
Low rate equity home loan with no application fee.
5.76%
$0
$550 p.a.
80%
Pay no application fee and enjoy a low interest rate.
5.64%
$395
$10 monthly ($120 p.a.)
90%
A home loan which gives flexible access to your equity.

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Credit services for Aussie Select, Aussie IQ and Aussie Optimizer products are provided by AHL Investments Pty Ltd ACN 105 265 861 Australian Credit Licence 246786 ("Aussie"), and its appointed credit representatives. Credit for Aussie Select products is provided by Residential Mortgage Group Pty Ltd ACN 152 378 133 Australian Credit Licence 414133 (“RMG”). RMG is a wholly-owned subsidiary of the Commonwealth Bank of Australia ABN 48 123 123 124 AFSL and Australian Credit Licence 234945. Credit for Aussie Optimizer products is provided by Perpetual Limited ABN 86 000 431 827 (Lender). Credit for Aussie IQ is provided by Macquarie Bank Limited ABN 46 008 583 542 AFSL and Australian Credit Licence 237502. Home loans issued by the Lender are serviced by Macquarie Securitisation Limited ABN 16 003 297 336, Australian Credit Licence 237863 (MSL).

Aussie is a trade mark of AHL Investments Pty Ltd. Aussie is a subsidiary of the Commonwealth Bank of Australia ABN 48 123 123 124. ©2018 AHL Investments Pty Ltd ABN 27 105 265 861 Australian Credit Licence 246786.

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Capital investment

If you’ve got equity to use and don’t need it for emergencies, a line of credit loan can help you use your equity as a capital investment.

Some examples of capital investment include;

  • Home improvements that could increase the value of your property
  • University funds
  • Investing in shares
  • Buying an investment property investment
With any investment, you need to carefully consider whether the potential returns will outweigh the cost of your line of credit home loan.
If you're using your line of credit to invest in property, make sure the rental income you can generate will cover your holding costs while you're waiting for capital growth. Likewise, if you're investing in shares you'll want to consider whether the returns and dividends outweigh the interest rate on your line of credit.
If you choose to use a line of credit to renovate, make sure to invest in improvements that offer the most return. In general, projects such as kitchens and bathrooms add the most value to a home, while projects such as swimming pools and garage conversions can actually make your home harder to sell.
About guide to investing in real estate

Is a line of credit the right loan for you?

A line of credit can give you access to money to achieve many of your financial goals, but before deciding on this loan, make sure you've decided on a plan and time frame for repaying the loan. If you cannot commit to a payment strategy, a line of credit may not be right for you.

Moreover, while there's nothing wrong with using a line of credit for lifestyle purchases such as holidays or cars, if your financial goal is to see a return from your line of credit loan, you should stay away from depreciating assets and luxury purchases.

About line of credit equity loans

Adam Smith

Adam has more than five years of experience writing about the Australian home loan market.

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