Understanding redraw facilities:
Accessing your extra home loan repayments
Last updated: 05 August 2025 | Estimated read time: 2 Minutes
A redraw facility lets you tap into the extra repayments you've made on your home loan. It can be a handy way to access funds when life throws you a curveball, like unexpected repairs or medical costs. But before you dip into your redraw, it’s worth understanding how it works and what it could mean for your loan.
What is a redraw facility?
A redraw facility gives you flexible access to the extra repayments you've made on your home loan. If you've been paying more than your minimum repayments, those extra funds may be available for you to use when you need them.
Whether it’s for a burst pipe, a surprise bill, or something else that pops up, having redraw available means you can use your own money, without needing to apply for a new loan.
Pros and cons of using redraw
Before using your redraw facility, it’s important to understand how it works — and how accessing those funds might affect your loan over time. While it’s convenient, it’s still part of your home loan, so using it wisely can help you stay on track with your financial goals.
Possible Pros
- You’re using your own money — no need to apply for a new loan
- No change to your loan’s credit limit
- Your repayment amount stays the same
- Redrawing doesn’t impact on your credit score or history
(But keep in mind your minimum monthly repayments still apply to your loan, and falling behind on repayments could affect your credit.)
Possible Cons
- Your financial buffer will shrink
- Your loan balance will increase by the amount you redraw
- You’ll have less available if you need funds later
Keep in mind: redraw availability depends on your loan type and lender policies. Some loans may have restrictions, minimum redraw amounts, or fees. If you’re unsure, check your loan terms or have a chat with your lender.
What’s an Additional Advance?
If you need more funds and redraw isn’t the right fit, you might consider an Additional Advance – that’s when you borrow more from your existing lender, based on the equity in your home.
Before applying, ask yourself:
- Has your property gone up in value since you bought it?
- Do you have a solid credit history?
- Are you comfortable with the extra repayments?
An Additional Advance is different from redraw – it’s new money that you’ll need to borrow, not money you’ve already paid in. That means your loan balance will go up, and your repayments might change. It’s worth comparing both options to see what works best for your situation.
Keep in mind: Applying for an Additional Advance may involve a credit enquiry, which could appear on your credit report.
How could redraw work for you?
Redraw can be a useful feature if you’ve made extra repayments and want access to those funds for unexpected costs. It’s usually available on variable rate loans, though some fixed rate loans may offer limited access.
Not sure if your loan includes redraw? Check your loan documents or give us a call – we’re here to help.
How much redraw do I have?
Contributor | Dianne Wassouf, Head of Customer Solutions
Dianne joined Pepper in 2012 and is now responsible for all Customer Service and Resolutions post settlement teams across Australia and Manila. Her expertise focuses on customer solutions and assistance and has equipped her with a deep understanding of client relations and service excellence.
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