Why Brickies Should Refinance to Fund a Business Move

Your house probably has more equity sitting in it than you think. If you've been laying brick for five years or more and you own property, you've likely built up a decent chunk of usable capital. Refinancing to pull that equity out is how many brickies fund their next business move without touching their cashflow or selling assets.

The process involves replacing your current home loan with a new one at a higher loan amount. The difference between what you owed and what you now borrow comes to you as cash. You're not taking out a separate business loan with its own application process and interest rate. You're increasing your mortgage and releasing the value your property has gained.

How Much Equity Can You Actually Access

Most lenders will let you borrow up to 80% of your property value without needing to pay lenders mortgage insurance. If your place is worth $650,000 and you owe $380,000, you've got $520,000 at 80% loan-to-value ratio. That leaves $140,000 in accessible equity before you hit the LMI threshold. You won't get all of it, because lenders factor in costs, but you're looking at a solid six-figure sum if your property has moved in value since you bought it.

The calculation matters because going above 80% changes the numbers. LMI adds thousands to the cost and might not make sense if you're pulling equity for business use. Staying under that threshold keeps the refinance process cleaner and the loan costs down.

Consider a bricklayer in Campbelltown who bought a place in 2018 for $520,000 with a 10% deposit. Property values in the area have lifted, and that same house is now worth $680,000. The mortgage sits at $410,000. At 80% LVR, the borrowing limit is $544,000. After paying out the existing loan, that's $134,000 in available equity. Enough to buy a second ute, take on an apprentice, or put a deposit on a small commercial space.

What You Can Use the Funds For

Business purchases are a common reason brickies refinance their home loan. New gear, a tipper, scaffolding, a laser level setup that doesn't quit halfway through a job. Some use it to cover wages while they chase late payments from builders. Others fund a pivot into retaining walls or outdoor kitchens where the margins are worth the setup cost.

You can also use equity to buy an investment property, which some brickies do to build a second income stream while they're still able to swing a trowel. The funds work the same way whether you're buying tools or bricks-and-mortar. The lender doesn't usually restrict how you spend the cash once it's released, but they will ask what it's for during the application.

When Refinancing Makes Sense and When It Doesn't

Refinancing to access equity works when your current interest rate is higher than what's available now, or when your loan lacks features you need like an offset account or redraw facility. If you're paying 5.8% on a loan you took out two years ago and variable rates have dropped, you can access a lower interest rate and pull equity at the same time. Two outcomes from one application.

It doesn't make sense if your property value hasn't moved or if you're already at 80% LVR. Refinancing costs money. Application fees, valuation fees, discharge fees from your old lender. If you're only accessing $30,000 in equity and your current rate is already solid, the costs might eat into the benefit. Run the numbers before you commit.

If your fixed rate period is ending, that's often the right moment to refinance and access equity. You're not paying break costs, and you're reviewing your loan anyway. It's a natural point to reassess your loan amount and pull funds if you need them.

How Lenders Assess Self-Employed Brickies

Lenders want to see consistent income. If you're self-employed, they'll ask for two years of tax returns and possibly your business activity statements. They're checking that your income can service the higher loan amount after you pull the equity out. A bricklayer turning over $180,000 a year with reasonable expenses will have a different borrowing capacity than someone showing $95,000 after deductions.

Some lenders are more flexible with how they assess tradie income. They understand that your tax return might show a lower figure because you've claimed depreciation on tools or a vehicle. Working with a broker who knows how self-employed loans for tradies are assessed means you're not stuck with a lender who only looks at the bottom line of your return.

Debt also matters. If you're carrying $40,000 in vehicle finance and $15,000 on a credit card, that reduces how much equity you can access. Lenders calculate your borrowing capacity based on your income minus your existing commitments. Some brickies refinance and consolidate that debt into the mortgage at the same time, which can improve cashflow even though the total loan amount goes up.

The Refinance Process for Accessing Equity

You'll need a property valuation. The lender arranges this, and it determines how much equity you actually have. If the valuer comes back at a lower figure than you expected, your accessible equity drops. That's more common in areas where property values have flattened or if your place needs work.

The application itself involves income verification, a credit check, and a review of your existing debts. If your loan is approved, the new lender pays out your old loan and the remaining funds come to you. The whole process usually takes three to five weeks if your documentation is in order and the valuation doesn't drag.

You'll also need to show what you're using the funds for. Lenders want a clear purpose. If you're buying equipment, they might ask for quotes. If you're investing in another property, they'll want details on that purchase. It's not about control, it's about risk assessment.

Ongoing Costs After You Refinance

Your repayments go up because your loan amount is higher. If you borrow an extra $100,000, expect your monthly repayment to increase by around $600 to $650 depending on the rate. That's money that needs to come from somewhere, either your wage or the income generated by whatever you bought with the equity.

Some brickies structure the loan so the equity portion is interest-only for a period, keeping repayments lower while they get the business move off the ground. That works if the funds are going into an investment that generates income, but it pushes the principal repayment down the line. It's a cashflow tool, not a way to avoid paying the loan back.

If you're using the equity to buy an investment property or fund business expansion, the interest on that portion of the loan might be tax deductible. Talk to your accountant before you refinance so you know how to structure the loan and keep the deductible and non-deductible portions separate. Getting that wrong costs you at tax time.

Refinancing to access equity is a practical move when your property has value you can put to work and your income supports the higher repayments. It's not a shortcut, but it's one of the few ways to access a large sum without selling assets or taking on high-interest business debt. If you've been thinking about expanding, upgrading gear, or buying your next property, the equity in your home might already be covering half the cost. Call one of our team or book an appointment at a time that works for you.

Frequently Asked Questions