Quick answer
Before borrowing against a property, check six figures on your existing loan statement: the balance, the approved limit, available redraw, any offset balance, whether repayments are up to date, and when any fixed or interest-only period ends. Lenders use these to work out your combined LVR and how comfortable the first loan looks. A payout figure is different from the balance and must be requested separately.
Key points
- Balance, limit and available redraw can be three different numbers.
- Lenders may use the limit, not the balance, if you can redraw.
- Arrears on the first loan are the most important thing a second lender checks.
- A payout figure includes accrued interest and fees; the balance doesn't.
Every property-secured lender asks for the same document first: your latest statement for the loan already on the property. It’s usually the quickest thing to produce and the thing that most often holds a file up, because owners send an old one, the wrong split, or a screenshot of the app that shows one figure but not the other five.
If you’re thinking about borrowing against a property for your business, whether through a top-up, a refinance or a second mortgage, it’s worth spending ten minutes with your statement first. Here’s what to look for and what each figure means to the next lender.
What are the six figures that matter?
| Figure | Where it usually appears | What it means for a new loan |
|---|---|---|
| Balance | Top of statement, “closing balance” | What you currently owe |
| Limit | Account details, “approved limit” or “loan amount” | The most you could owe under the existing contract |
| Available redraw | Account summary or app | Money you’ve paid in advance and can take back out |
| Offset balance | Separate linked account | Your savings reducing interest, withdrawable at any time |
| Arrears or overdue amount | Account summary, sometimes a notice | Missed or late repayments |
| Rate type and end dates | Account details | Fixed or variable; interest-only or principal and interest; when each period ends |
Most statements show at least the first three. Some only show the balance, and you’ll find the limit and redraw in your online banking or by calling the lender.
Why can balance, limit and redraw all be different?
Picture a loan approved at $600,000. Over the years you’ve paid it down, and you’ve also made extra repayments. Today:
- the limit is still $600,000 (or a reducing limit based on the original schedule);
- the balance is $420,000;
- available redraw is $60,000, meaning you’ve paid $60,000 ahead of schedule.
To a second lender, that redraw matters. You could draw the $60,000 tomorrow, and it would rank ahead of any second mortgage because it’s part of the first lender’s mortgage. That’s why second lenders often calculate combined LVR using the limit, or balance plus available redraw, rather than the balance alone. Our page on combined LVR explains the calculation.
Two common fixes: ask your lender to reduce the limit to the current balance, or agree a priority amount with the first lender that caps what it can claim ahead of the second. See priority and registration.
What does the lender read into your repayments?
The single most important question a second lender asks about your first loan is whether it’s up to date. Arrears on the first mortgage are a serious warning sign, because the first lender could eventually enforce its security, and the second lender would only be repaid from what’s left.
Look for:
- an “arrears”, “overdue” or “amount due” figure;
- repayments that dishonoured and were re-debited;
- hardship arrangements or repayment pauses.
If there’s something there, don’t hide it. A specialist can often structure around a short, explained blip, and sometimes a second mortgage is used partly to clear first-loan arrears. What they can’t work around is finding it on their own. For how credit history is weighed generally, see bad credit second mortgages.
Why do fixed and interest-only end dates matter?
Two dates on your loan affect what’s sensible next:
Fixed-rate expiry. Breaking a fixed rate early can involve break costs. If yours has a year or more to run, refinancing the whole loan might be expensive, which is one reason owners keep the first loan in place and use a second mortgage instead. See second mortgage vs refinance.
Interest-only expiry. When an interest-only period ends, repayments usually rise because principal starts being repaid. A lender will consider how that increase affects the household or business, so know the date.
Want someone to read your statement with you? Send the basics through and a specialist will explain what a new lender would see.
What’s the difference between a balance and a payout figure?
The balance on your statement is what you owed at the statement date. A payout figure is what it would cost to clear the loan completely on a specific date. It includes:
- the balance;
- interest accrued since the last interest charge;
- any fees to close the loan, such as a discharge fee;
- break costs if the loan is fixed;
- any other amounts under the contract.
You don’t need a payout figure to apply for a second mortgage, because your first loan stays in place. You do need one if the plan involves paying out the first loan, such as a refinance or a sale. We cover payout mechanics in detail in paying out a second mortgage.
What if you have several splits or linked accounts?
Many loans are split: part fixed, part variable, sometimes an investment split and a home split. Each has its own account number, balance, limit and rate type. Lenders need a statement for every split secured on the property. It also helps to note which split is linked to which offset account.
If there’s also a line of credit or business overdraft secured over the same property, include that too. Anything registered against the title will show up in the lender’s title search.
How do you download the right statement?
- Log in to internet banking or the app.
- Open the loan account itself (not the transaction account it’s paid from).
- Look for “statements”, “documents” or “e-statements”.
- Download the latest periodic statement as a PDF.
- Separately, note or screenshot the approved limit and available redraw if the statement doesn’t show them.
- Repeat for every split.
If your lender only issues statements every six months, ask for an interim statement or a letter confirming the current balance, limit and that the account is up to date.
How does this feed into what you can borrow?
Once you have the right figures, the arithmetic is simple. Take the property value, multiply it by a lender’s comfortable combined LVR for your property type, and subtract the first-loan figure the lender will use. That’s your realistic headroom. Our equity and LVR calculator does this for you and shows the difference between using the balance and using the limit.
For the gap between what the property is worth on paper and what you can actually borrow, see our guide to usable equity vs paper equity.
Illustrative example: the redraw that changed the answer
An owner with a home valued at about $900,000 checks her statement: balance $380,000, limit $520,000, available redraw $140,000. Using the balance, a $200,000 second mortgage would take combined LVR to about 64%. Using the limit, it would be about 80%, too high for comfort. She asks her bank to reduce the limit to the current balance, which also removes the redraw. The combined LVR is then assessed at about 64%, and the loan proceeds. The figures are illustrative.
Does the first lender need to know?
If your mortgage terms restrict further mortgages, your first lender will need to consent to a second mortgage. Your statement won’t tell you that, but your loan contract will. Our page on first mortgagee consent explains where to look.
Statement in hand? You’re most of the way there
With your first-loan statement ready, the rest of a property-secured enquiry is straightforward. It takes about 60 seconds, and there’s no credit check when you first enquire.
Your details aren’t passed to a line of lenders; one specialist reads them and calls you back to work through the numbers, including whether the balance or the limit will count. Please enter the balance, the limit and any arrears exactly as your statement shows them. Accurate figures now mean the loan we discuss is one that survives the lender’s own checks.
Frequently asked questions
Where do I find my home loan statement?
Most lenders let you download statements in internet banking or the app, usually under the loan account's documents or statements section. You can also ask your lender to email or post one.
How recent does the statement need to be?
As recent as possible. Lenders usually want the latest periodic statement, and may ask for a transaction listing covering the last few months to check repayments.
What if I have several loan splits?
Provide a statement for each split. Each has its own balance, limit and rate type, and the lender adds them together.
Is an offset account counted against my loan?
An offset balance reduces the interest you pay, but it's your money and you can withdraw it. Lenders generally look at the loan balance itself, though a healthy offset balance can support the overall picture.
Why does the payout figure differ from the balance?
The payout figure adds interest accrued since the last charge date, any fees to close the loan and, for fixed loans, any break costs.