Ways to get additional borrowing on your existing mortgage

Additional borrowing implies that when you refinance, you borrow more money, increasing the overall amount of your mortgage. You may then utilise these additional funds to pay for things like house upgrades or school tuition.

Further advance

A further extension is when you borrow extra money from your current mortgage provider. Taking out a second advance is frequently utilised for home upgrades or as a down payment on a second house.

When you ask for a further advance, your mortgage lender will go over your budget with you and analyse your earnings and cash outflows (such as other loan obligations and living expenses) to ensure you can keep up with your payments.

It’s crucial to remember that the extra cash you take out will be tied to your home, which you may lose if you can’t keep up with your mortgage payments.


Refinancing is the process of transferring your mortgage debt to a new mortgage arrangement, either with your current lender or with a new lender. When you refinance, you can also borrow additional money by expanding the amount of your mortgage loan.

As you refinance, you will be asked if you want to borrow more money. If you wish to lend more, we will ask how much more you want to borrow and what you plan to use the funds for, such as home upgrades, debt consolidation, car purchases, etc.

Lenders may ask you more questions if your additional loan is considerable (often more than $30,000). However, a lender’s judgement on your application to borrow extra money will be based on their affordability assessment.

Second charge mortgage

A second charge mortgage is a sort of secured loan that borrows extra funds by using your home as collateral. You can use the equity in your house as collateral for a new loan. This implies you’ll need to have some equity (wealth accumulated in your current property) in order to apply for more loans.

To determine how much equity you have in your house, subtract the amount owed on your first mortgage from the value of your property. So, if your house is worth $750,000 and you have a mortgage for $500,000, your capital or equity is $250,000.

To get a second charge mortgage, you must first obtain approval from your present mortgage lender and then demonstrate to the second mortgage lender that you can afford to make the instalments on both loans.

Is it a good idea to borrow more on your mortgage?

The benefits and drawbacks of borrowing more on your mortgage are determined by your specific financial situation.

There are risks associated with extra borrowing because you would be borrowing over your property. This implies that if you cannot keep up with your repayments, your house is in jeopardy. With this in light, it may be worthwhile to investigate alternatives to borrowing on your mortgage, such as obtaining an unsecured loan.

If you opt to receive a further extension on your mortgage, it may impair your future capacity to refinance. You may have to pay a charge to exit your existing mortgage arrangement, and the process might take 6-8 weeks.

You must ensure that the value of your home has grown above the amount borrowed for the mortgage (known as having equity in your property). If you want to borrow more on your mortgage, make sure you can afford to make the payments. If you are unable to make your repayments, your house may be seized by the lender.

What can I use the additional money for?

Whenever you refinance, you will be asked if you want any extra borrowing. If you say yes, you will be asked you how much amount you want to borrow and what you plan to use it for. For example, you will be asked to select one of the following options:

  • Home improvements
  • School fees
  • Divorce settlement
  • Debt consolidation
  • Car purchase
  • Other property purchase
  • Other

If you think this is something that will help you make some of those renovation or other finance plans come true then give us a ring and we can discuss further on how can we make it happen.

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