ACL 390611 | MFAA Member | Established 2005
Cash-Out Refinance.Equity You Can Actually Use.
Releasing equity is straightforward. Getting the structure right is the part that matters, because the ATO decides what you can claim by what the money was used for, and once a loan is mixed it stays mixed for its whole life. We set it up so that never becomes your problem.
15 minutes on the phone. Tell us what the money is for and roughly what the property is worth. No credit check, no paperwork, no obligation. If the debt you are trying to clear is small and short, we will tell you not to put it on your mortgage. Lenders pay us a commission on settlement and we disclose it in writing before any work begins.
Intellect Finance – Equity Release Specialists
Independent since 2005 | ACL 390611What Is a Cash-Out Refinance and How Does Equity Release Work?
A cash-out refinance increases your existing home loan and releases the difference to you as usable funds, drawing on equity you have already built. Lenders generally want evidence of what the money is for, and how the interest is treated for tax depends on that purpose rather than on the property securing it.
Equity is the gap between what your property is worth on the lender’s valuation and what you still owe. A cash-out refinance converts part of that gap into cash by writing a larger loan. Nothing is sold and nobody takes a share of your property.
Two things decide whether it is done well. Whether the release is taken as a separate split rather than folded into your existing loan, and whether the purpose is one the lender will fund at the loan to value ratio you need. Both are settled before anything is lodged, because neither is easy to unwind afterwards.
Common Situations
What People Actually Release Equity For
Six purposes cover almost every cash-out we arrange. Lenders treat them differently, and so does the ATO, which is why the reason gets asked first.
Renovating the home you live in
The most common reason and the most straightforward to fund. For structural work a construction facility may suit better, because it draws down in stages against progress. See construction and renovation loans.
The deposit on an investment property
Very common, and the one where structure matters most. Because deductibility follows use, borrowing for an investment purpose is treated on that purpose. Take it as its own split. See investment loans.
Consolidating other debts
It lowers the monthly figure by stretching short debts across a long term, and it moves unsecured debt onto your home. Sometimes right, often not. The honest version is further down this page.
Funding a business or a deposit on premises
Residential security for a business purpose is common and is assessed differently. Where the borrowing is genuinely for business, our commercial finance options may fit better and sit outside the consumer credit rules.
A large one-off cost
School fees, a vehicle, a family event. All are fundable, none of them is deductible, and all of them permanently change the ratio on any loan they are drawn against. That is the whole argument for a separate split.
Building a buffer
Releasing equity to sit in an offset against the same loan is a legitimate strategy for some people and an expensive habit for others. It depends on the rate, the discipline and what you would otherwise do with the cash.
Social Proof
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Joseph Sukkar
Principal Broker · ACL 390611
Who You’re Dealing With
Built on 25 Years in Australian Finance
Joseph Sukkar started in finance in 2000 and founded Intellect Finance in Penrith in 2005. Since then the team has arranged more than 6,500 loans for clients across Australia, from first homes to complex commercial and asset finance.
Residential lending sits with Moufid, our Head of Residential Lending, who has untangled enough mixed loans to insist on splitting them at the start. On an equity release the useful work happens before anything is lodged: settling what the money is for, deciding whether the release goes out as its own split, and knowing which lenders fund that purpose and how far they will go. A separate split costs nothing to arrange at settlement and it cannot be fixed later.
100+ Lenders Including
Accreditation with a lender is not an endorsement by it. Which lender suits you is decided by your file, not by who is on this list.
Know What It Is For?
That is the first question a lender asks. Fifteen minutes, no credit check.What Actually Decides It
A Cash-Out Refinance Is Judged on What You Do With the Money
Releasing equity is easy. The consequences are decided by use, not by security, and several of them are permanent. Six things worth understanding before the funds are drawn rather than at your next tax return.
Use governs and the property does not
The ATO’s position is that you must separate the interest relating to an income-producing purpose from interest on funds used for private purposes. Borrowing against your home to buy an investment does not make that interest private. Borrowing against an investment to fund a holiday does not make it deductible.
A mixed loan stays mixed for its whole life
This is the one nobody is told. Where a single loan funds both purposes, the ATO requires the interest to be apportioned by the ratio of the two, and states that all loan repayments must be apportioned across both portions for the length of the loan. You cannot pay down the private half first. Every dollar you repay comes off both.
A private redraw permanently resets the ratio
Redraw from a loan for a private purpose and the ATO treats the balance as increased, with the deductible proportion recalculated against the new balance. It does not revert when you repay it. One convenient redraw against an investment loan can quietly cost you deductions for the next twenty years.
Refinancing does not wash the private portion out
The ATO is explicit that you cannot claim the portion of a loan used for private purposes, both when you took the loan out and when you refinance it. Moving a contaminated loan to a new lender changes the rate. It does not change the ratio, and no lender will tell you that.
Short debt on a long mortgage costs more
ASIC’s warning on consolidating is direct: the interest rate may be lower, but you could pay more in interest and fees in the long run, and if you cannot pay the new loan the home you put up as security may be sold to recover it. Both halves of that sentence matter.
It is new lending assessed at today’s settings
A cash-out is a fresh credit assessment, tested at your rate plus APRA’s buffer of at least 3 percentage points, and it counts toward the debt-to-income limit that has applied to banks since February 2026. Your existing loan being comfortable does not mean the larger one will be.
Checked 31 August 2026. Apportionment of interest and repayments on mixed purpose loans, the treatment of redraws and the position on refinancing are published by the ATO under interest expenses. Debt consolidation risks are described by ASIC Moneysmart. Lenders mortgage insurance is generally charged above 80 per cent of the lender’s valuation and protects the lender rather than you, per ASIC Moneysmart on switching home loans. Serviceability and macroprudential settings are set by APRA, and Best Interests Duty by ASIC Regulatory Guide 273. We are not tax agents. Confirm your position with a registered tax agent or the ATO before you draw or redraw funds. Everything else on this page is described in the important information at the foot of the page.
None of this makes releasing equity a bad idea. It makes the structure worth ten minutes of attention at the start, when a separate split costs nothing, rather than a conversation with your accountant in three years when it costs a great deal. Get the structure right first.
The Honest Comparison
Add It to Your Loan or Take a Separate Split?
Most lenders will happily do either and will not raise the question. It is the single most consequential decision in an equity release, and it costs nothing to get right.
Increase your existing loan
- One loan, one repayment, one account to watch
- Marginally less paperwork at settlement
- Perfectly fine where the purpose is entirely private and always will be
- If any part is income-producing, the loan is mixed and every repayment is apportioned for its whole life
- Your accountant reconstructs the ratio every year, and refinancing later does not fix it
Take the release as its own split
- Deductible and private borrowing stay cleanly separate from day one
- The purpose of each split is obvious from the statements, without reconstruction
- You can repay one split without touching the other
- Usually free to arrange at the time, and available from most lenders on request
- Two accounts and two repayments, and it only helps if you keep the discipline afterwards
And the harder advice, which is about the money rather than the structure. If you are releasing equity to clear a credit card or a car loan with two or three years left on it, think carefully before putting it on a thirty-year mortgage. ASIC’s own warning is that the rate may be lower but you could pay more in interest and fees in the long run, and that unsecured debt becomes debt your home is securing. We would often rather you kept it short, paid it off, and left your equity where it is, even though that means no loan for us. If the debt is genuinely large, genuinely long, and the alternative is missing payments, consolidating can be the right call, and in that case it should come with a repayment plan rather than just a lower monthly figure. Free, independent financial counselling is available through the National Debt Helpline on 1800 007 007, and we will say so before we will write that loan.
Ask Us Whether the Split Beats the Increase
Tell us what the release is for and how long the debt has left to run. Fifteen minutes. No credit check.The Difference
The Structure Is the Whole Job
Any lender will release equity. Very few will ask what it is for in a way that changes how the loan is written, because the paperwork is the same either way and the consequence lands on you three years later.
Split by Purpose Every Time
Deductible borrowing in one split, private borrowing in another, set up at settlement when it is free. It takes one extra line on the application and it saves your accountant reconstructing a ratio every year for the life of the loan.
Legally On Your Side
Releasing equity against the home you live in is regulated consumer credit, so Best Interests Duty applies. We must act in your best interests and give priority to your interests where they conflict with ours. Those obligations have applied to mortgage brokers since 1 January 2021.
No Fee. Not Even Clawback.
We do not charge you for the comparison, the structuring or the application, on any loan type. If you discharge the loan early we wear the clawback ourselves rather than invoicing you for it, which plenty of brokers do. Lenders pay a commission on settlement, disclosed to you in writing before any work begins.
Purpose Decides the Lender
Lenders differ sharply on cash-out. How far they will go, what evidence they want, and which purposes they will fund at all. Renovation, investment deposit, business use and consolidation are four different conversations, and knowing which lender takes which is the job.
The Process
How a Cash-Out Refinance Comes Together
Four steps, and the purpose conversation happens in the first one because everything else follows from it.
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15 minutes
What it is for and what you owe
The purpose, the rough value of the property, your current balance and your income. No documents and no credit check. You finish the call knowing what is realistically available, which lenders fund that purpose, and whether a split is needed.
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Before lodging
Structure and your accountant if needed
Whether the release is a separate split, how it is sized, and whether any part of it is income-producing. Where the purpose has a tax consequence we say so and send you to your accountant before anything is drawn, not after.
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You gather
Documents
We confirm exactly which of these your chosen lender wants before you go looking for any of them.
- Photo identification
- Two recent payslips
- Latest tax return or group certificate
- Six months of home loan statements
- Three to six months of bank statements
- Details of existing debts and card limits
- Evidence of purpose, such as a quote or a contract
- Rental statements, if the security is an investment
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We manage
Valuation then approval and drawdown
The valuation sets what is available, so the release is confirmed rather than assumed at that point. We manage conditions and lender communication, and make sure the splits settle the way they were designed rather than being merged by someone in processing.
Track Record
Independent Since 2005
Joe Sukkar started in finance in 2000 and founded the practice five years later. Residential lending sits with Moufid, who has untangled enough mixed loans to insist on splitting them at the start.
Related Options
Other Ways to Fund What You Are Planning
Releasing equity is one route, and often not the least expensive. These are the alternatives worth pricing against it.
Refinance home loan
If the point is a better rate or structure rather than taking money out.
Personal loans
Often the better answer for a small, short debt you do not want on your home.
Construction and renovation loans
For structural work, where staged drawdowns beat taking the lot up front.
Investment loans
Where the released equity is becoming a deposit on the next property.
Second mortgage
When your existing loan is worth keeping and the need is a further advance behind it.
Every home loan we arrange
Back up to the full residential range if none of these is quite it.
Split It Properly the First Time.
It costs nothing at settlement and it cannot be fixed later.Questions Answered
Cash-Out Refinance FAQs
The questions people releasing equity ask us most often before getting in touch.
What is a cash-out refinance?
A cash-out refinance increases your existing home loan and releases the difference to you as usable funds, drawing on equity you have already built. Nothing is sold and nobody takes a share of your property. Lenders generally want evidence of what the funds are for, and some purposes are funded more readily than others.
How much equity can I release?
It depends on the lender’s valuation, your existing balance and your ability to service the larger loan. As a general position, borrowing above 80 per cent of the lender’s valuation brings lenders mortgage insurance into play. The purpose of the release also affects how far a particular lender will go.
What can I use the released funds for?
Renovations, an investment deposit, business purposes, a large one-off cost or consolidating other debts are all common. Lenders generally ask for evidence of purpose, and some decline certain purposes outright. The purpose also determines the tax treatment of the interest, so it is worth settling before the funds are drawn.
Is the interest on a cash-out refinance tax deductible?
It depends entirely on use, not on the property securing it. The ATO requires you to separate interest relating to an income-producing purpose from interest on funds used for private purposes. Borrowing against your home for an investment is treated on that investment purpose. Confirm your position with a registered tax agent.
Should I take the release as a separate split?
Almost always, if any part of it is income-producing. Where one loan funds both private and income-producing purposes, the ATO requires interest to be apportioned, and all loan repayments must be apportioned across both portions for the length of the loan. A separate split avoids that entirely and usually costs nothing to arrange.
Can I use a cash-out refinance to consolidate debts?
You can, and it is worth thinking hard about first. ASIC’s warning is that the interest rate may be lower but you could pay more in interest and fees in the long run, and that debts secured against your home put the home at risk if you cannot pay. Free financial counselling is available on 1800 007 007.
Will releasing equity mean paying lenders mortgage insurance?
Only if the new loan takes you above 80 per cent of the lender’s valuation, which is generally where LMI applies. Below that, releasing equity does not trigger it. LMI protects the lender rather than you, and it is charged on the new loan and the new valuation rather than carried over from before.
Does Best Interests Duty apply, and what does Intellect Finance charge?
Yes it applies. Releasing equity against a home you live in is regulated consumer credit, so brokers must act in your best interests and give priority to your interests where they conflict with ours. We charge you nothing on any loan type, and no clawback fee if you discharge early. Lenders pay a commission on settlement.
Visit Us
Penrith Based.Clients Australia-Wide.
Penrith is our head office and the one you can walk into without an appointment. We also meet clients at Parramatta and in the Sydney CBD by arrangement. Most of the process runs by phone, email and video, so we release equity for clients in every state.
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Suite 23, Level 1, 181 Church St, Parramatta NSW 2150
Mortgage broker Parramatta →Ready When You Are
Find Out What Your Equity Can Do.
Fifteen minutes with a residential specialist. Tell us what the money is for and we’ll tell you what is realistically available, which lenders fund that purpose, and how the release should be structured so your deductible and private borrowing never mix. If the debt you are clearing is small and short, we’ll tell you to keep it off your mortgage. No credit check, no paperwork, no obligation. Penrith based, clients Australia-wide. Intellect Finance Pty Ltd, ACL 390611.
A home loan for a property you will live in is regulated consumer credit, so Intellect Finance is legally required to act in your best interests under the Best Interests Duty in the National Consumer Credit Protection Act. We are not tax agents and nothing here is tax advice. The tax treatment of released funds depends on what they are actually used for and must be confirmed with a registered tax agent. Nothing on this page is credit assistance, legal advice or an offer of credit, and no outcome is guaranteed.
Intellect Finance Pty Ltd | Australian Credit Licence 390611 | MFAA Member | AFCA Member
Important information General information only. Not credit assistance, legal advice or an offer of credit. We charge you no fee. Every caveat and source on this page is collected here. Tap to read.
General information only. The content on this page is general in nature and does not take into account your objectives, financial situation or needs. It is not credit assistance, financial advice, legal advice or tax advice, and it is not an offer of credit. You should consider whether it is appropriate for you and seek your own advice before acting on it.
We are not tax agents. Every tax position described on this page is the Australian Taxation Office’s published general position, cited and dated where it appears. Whether it applies to you depends on your circumstances and on what borrowed funds are actually used for. Apportionment of interest and repayments on a mixed purpose loan, the effect of a redraw, and the treatment of a refinanced loan must all be confirmed with a registered tax agent or the ATO before you act. Nothing on this page is a substitute for that advice.
Increasing your debt. A cash-out refinance increases the amount you owe and the amount secured against your property. Where unsecured debts are consolidated into a mortgage, debt that was not secured against your home becomes debt that is. A lower interest rate does not always mean a lower total cost, because a longer term can increase the interest and fees paid over the life of the loan.
Financial difficulty. If you are having trouble making repayments, you can ask your lender for hardship assistance. Free and confidential financial counselling is available through the National Debt Helpline on 1800 007 007.
Nothing here is a guarantee of approval. Loan approval, borrowing capacity, interest rates, loan to value ratios, valuations, cash-out policies and eligibility are determined by individual lenders and by independent valuers, not by us. They differ between lenders and change over time. How much equity a lender will release, what evidence of purpose it requires and which purposes it will fund are set the same way. Timeframes vary with the lender, the valuation and the complexity of the application, and are not guaranteed. Any figure or timeframe on this page is indicative and is not a quote, an offer, or a prediction of your outcome.
Best Interests Duty. A home loan for a property you will live in is regulated consumer credit under the National Consumer Credit Protection Act 2009. When providing credit assistance in relation to these products, Intellect Finance is required to act in your best interests and, where there is a conflict of interest, to give priority to your interests. These obligations have applied to mortgage brokers since 1 January 2021.
How we are paid. Intellect Finance does not charge borrowers a fee for arranging finance, and does not charge a clawback fee where a loan is discharged early. Lenders pay us a commission on settlement. The basis of that commission is disclosed to you in writing in our Credit Guide before any credit assistance is provided.
Third-party information. Where this page refers to regulatory settings, consumer guidance or lender policy, that information is sourced from the relevant authority and was correct to the best of our knowledge at the date shown on this page. Those rules change, sometimes without notice. Always confirm the current position with the issuing authority or with us before relying on it.
Found something wrong? If you believe anything on this page is inaccurate or out of date, tell us at joe@intellectfinance.com.au and we will review and correct it.
Intellect Finance Pty Ltd | Australian Credit Licence 390611 | MFAA Member | AFCA Member