Home improvement

Financing a renovation: What are your options?

4 min read

Home improvement

Financing a renovation: What are your options?

4 min read

Is your home in need of a little attention? Maybe your spare bedroom seems a little lacklustre, or your kitchen needs a makeover. Whatever it is, now could be the right time for a home renovation. So, how are you going to fund it?  

Increase your home loan

Increasing your home loan with an ‘Add’ or ‘Equity’ Loan can help you access additional funds for your renovation. You could also use equity to consolidate debts which could help you save money over time to contribute towards a renovation. The minimum borrowing amount for ‘Add’ and ‘Equity’ loans is $10,000.

More about Add & Equity Loans

Add Loans

An ‘Add’ loan increases your existing loan amount. Though your payment amount will increase and you will pay more interest over the term of the loan, the loan term and loan type remains the same. You could potentially consider using an ‘Add Loan’ if the funds will be used for larger renovations and you would prefer to repay the money over the remaining term of your existing home loan. Say you have a $300,000 home loan with 20 years remaining. You decide to apply for a $15,000 loan to renovate your bathroom. If you’re successful in your application, your home loan would increase to $315,000 and still have the 20 years remaining.

Equity Loans

An ‘Equity’ loan is an entirely new loan. It’s still secured against your home, however you will have a separate additional repayment each month. You can choose to select a different loan type and/or loan term to your current home loan. You could consider taking out an ‘Equity’ loan if you would like to repay the new loan amount on different terms to your current home loan (e.g. by repaying the loan faster). The term of the loan will need to be at least 8 years and no longer than 30 years.

Consider cashback on your home loan

If you have made additional repayments on your loan, you may be able to apply to access these funds through cashback to pay for your renovations. Once approved and established, our Home Loan Cashback feature could allow you to redraw money you’ve paid in addition to your normal scheduled home loan repayments. Customers with Standard Variable and Back to Basics Variable Home Loans are able to apply to access this feature. Visit the Home Loan Cashback page for more details.1

Thinking about
to your home?


Discounted Back to Basics Variable Rate with Green Upgrades Equity Home Loan Offer. Owner Occupied or Investment. New to bank lending ≥ $10k-25k. Maximum LVR 80%. Principal and Interest Repayments. View complete eligibility requirements, terms and conditions.

Thinking about making eco-upgrades to your home?

Discounted Back to Basics Variable Rate with Green Upgrades Equity Home Loan Offer. Owner Occupied or Investment. New to bank lending ≥ $10k-25k. Maximum LVR 80%. Principal and Interest Repayments. View complete eligibility requirements, terms and conditions.

Other financing options

Use your credit card

For a smaller DIY renovation, opting to use a low interest rate credit card is another way you could potentially fund a home renovation project.

Aside from the convenience, credit cards can make it easy for you to purchase materials you need, especially if you can’t pay the full amount straight away, such as if you had to pay an unexpected bill for a hospital visit or car repair. You will, however, be charged interest on any amount outstanding once the interest-free period ends (if any).2 Plus, there may be reward options if you want more from your card.3

Dip into your savings

If you’ve got extra money set aside for a home renovation, then you could save money in the long run by avoiding the interest you’d have to pay with a loan or credit card. However, you may want to consider a few things.  

  • If you have your savings in an offset account, deciding to use these funds for your renovation will increase the amount of interest you pay on your home loan. Keeping your savings in an offset account won’t reduce your monthly repayment, but it will reduce the amount of interest you pay each month, which means more of what you pay can go towards reducing the principal balance. Let’s say your loan is for $400,000 and you have $10,000 into your offset account. Each month you will only be charged interest on $390,000. Should you choose to use the $10,000 to fund your renovation, you will then be charged interest on the full $400,000 balance on your loan.4
  • Do you have extra cash saved? It can be handy to have an emergency fund for unexpected events, like if your car breaks down or you need to cover additional renovation costs. It’s good to have cash set aside just in case.

Talk to the home loan experts

Getting the right finance for a renovation project could help it succeed, and help ensure you’re not paying more than you need to. If you’d like more information about the kinds of loans available for home renovations, Suncorp Bank’s Home Loan experts can answer any questions you might have. Get in touch today for an obligation-free consultation to help you decide whether this is the right option for you.


Published 6 August 2022

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1You need to apply for Cashback, which may be available subject to conditions specified in the contract. Please read these conditions carefully. Available Cashback may exclude any recent cheque, direct debit or pay at post payments and external transfers cannot be performed using online Cashback. Fixed Rate home loans are excluded from Cashback.

2The interest free period applies from when you pay your full closing balance from your last statement of account by the payment due date (excluding any fixed payment option balance which isn’t due for payment by that payment due date). No interest free period is available on cash advances or balance transfers. While you have a balance transfer, you will be charged interest on your daily unpaid balance.

3All rewards are subject to the Terms and Conditions of Suncorp Bank Credit Card Rewards and Suncorp Bank Credit Card Qantas Frequent Flyer Rewards for Suncorp Bank Clear Options.

4A Mortgage Offset Fee may apply to link the 100% Home Loan Offset facility to your home loan, which is waived under the Home Package Plus. The Mortgage Offset fee is charged to your linked loan account.

Home Loans and other banking products are provided by Suncorp-Metway Ltd ABN 66 010 831 722 AFSL No. 229882 Australian Credit Licence 229882 (“Suncorp Bank”) to approved applicants only. Eligibility criteria, fees, charges, terms and conditions apply and are available on request. Please read the relevant Product information Document before making any decision about a product. Contact us for a copy. Any advice does not take into account your particular objectives, financial situations or needs, so you should consider whether it is appropriate for you before acting on it.

National Australia Bank Limited (ABN 12 004 044 937, AFSL and Australian Credit Licence 230686) (“NAB”) is the credit provider and issuer of Suncorp Bank Clear Options Credit Cards. Suncorp-Metway Ltd ABN 66 010 831 722 (“Suncorp Bank”) promotes and distributes Suncorp Bank Clear Options Credit Cards on NAB's behalf under an agreement with NAB. NAB has acquired the business relating to this credit from Citigroup Pty Ltd (ABN 88 004 325 080, AFSL and Australian Credit Licence 238098) (“Citi”) and has appointed Citi to assist to administer the Credit Cards. Suncorp Bank will not guarantee or otherwise support NAB's obligations under the contracts or agreements connected with the Credit Cards (other than those relating to Internet Banking and Telephone Banking).

The information is intended to be of general nature only. We do not accept any legal responsibility for any loss incurred as a result of reliance upon it – please make your own enquiries.

Comparison Rate Warning specific to this offer: ##The comparison rate is based on $150,000 and over 25 years. WARNING: This comparison rate applies only to the example given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan.

^^ Discounted rate is only available for new Personal/Owner Occupied or Investment loans taken out as part of the Suncorp Bank Green Upgrades Equity Home Loan Offer. Existing lending ≥$150,000 and new equity lending between $10,000-$25,000 and borrowings ≤80% of the security property value (LVR) inclusive of lenders mortgage insurance (if applicable), with Principal and Interest repayments. The discounted rate (currently 2.39% p.a) is calculated by subtracting a discount of 2.76% from the Standard Back to Basics Variable Rate (currently 5.15% p.a.) for Owner Occupied Loans, or by subtracting a discount of 3.18% from the Standard Back to Basics Variable Rate (currently 5.57% p.a.) for Investment Loans. Rates and discounts are subject to change and may be varied if the loan purpose or repayment type is changed. Pre-approvals excluded. The discounted rate is available on eligible loans applied for from 30 June 2022 until 31 January 2023 unless withdrawn earlier.

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This covers the sudden liquid leaking, overflowing or bursting from things like your fridge, washing machine, bath, toilet, fixed pipes (except agricultural pipes), gutters, swimming pool, water main, fixed cooling system or an aquarium.

We don’t cover damage caused by wear and tear or the gradual leaking of liquid when you’d be reasonably expected to be aware of the condition.

Variable Rate

A rate that is variable and is subject to change over the loan term.

Comparison Rate

A comparison rate is a rate that indicates the true cost of a loan. This rate incorporates certain fees and charges that are applicable for the chosen product. For more information about the comparison rate and the comparison rate warning, please refer to the things you should know section of this page.