By Jeremy Harper, Director — hfinance
Some of the biggest financial moments in a family aren’t about buying
or selling a house at all. They’re about holding one together through a
separation, helping your kids onto the property ladder, or bridging a
gap while an estate is settled.
In each case, the home you already own is often the answer — even
when the bank can’t see a way to help.
When life doesn’t fit
the servicing test
Family milestones rarely arrive with clean paperwork. Incomes change,
hours drop, timelines slip. And the bank’s servicing test doesn’t make
much allowance for “this is temporary” or “the money’s coming.”
For equity-rich homeowners, a second mortgage through a specialist
lender can release funds against the home — usually with no monthly
repayments and no fixed term — to get through the moment, then be repaid
from a refinance, sale or expected proceeds. Here’s how that plays out
across three common situations.
Keeping the family
home after separation
A separation often forces a decision no one wants: sell the family
home, or find a large lump sum to settle and stay.
One example — a home in the eastern suburbs worth around $3.6M with a
$1.2M mortgage. Following separation, $700K was needed to complete the
family law settlement and keep the home for the children, plus $50K for
legal and transition costs. The bank wouldn’t approve the extra $750K
under standard servicing.
A second mortgage released the full amount with no monthly payments,
so the settlement completed, the kids stayed in their home and school
routine, and there was breathing room to plan the longer-term refinance
or sale on sensible terms — not in crisis.
Helping your children buy
Plenty of parents want to help their kids with a deposit but don’t
want to take on new monthly outgoings to do it — especially heading into
retirement.
Consider parents with a home worth about $2.8M and a $1.1M mortgage,
wanting to give each of two children a deposit and trim their own loan.
The bank wouldn’t approve the extra $650K after one of them reduced
their work hours. A second mortgage released $250K for each child and
put $150K toward the primary mortgage — supporting both kids fairly,
reducing their own repayments, and transferring some wealth within their
lifetime rather than later.
Bridging an inheritance
Money that’s coming isn’t money you can spend. Probate can take 12 to
18 months, and banks won’t lend against a future inheritance.
One homeowner needed $180K to help her son with a deposit and $120K
to clear personal debt, with an inheritance still tied up in probate. A
$300K second mortgage bridged the timing gap with no monthly payments,
to be repaid when the estate settled — so her son didn’t miss his
purchase and the high-interest debt was gone in the meantime.
The part we always spell out
These facilities typically carry no monthly repayments, which means
interest accrues and compounds against your equity until the loan is
repaid. That’s well suited to a defined event with a clear end point — a
settlement, a sale, an inheritance — rather than open-ended borrowing.
We’ll always model the cost over the likely timeframe so you’re deciding
with the full picture.
Where we come in
Family finance is personal, and the right answer depends on the whole
situation — yours and, often, your children’s. We’ll talk it through
properly, model the exit, and only recommend an equity release if it
genuinely leaves your family better off.
If you’re weighing up how to support the people who matter most, reach out — we’ll give you a clear, honest read.
Written by Jeremy Harper, Director of hFinance. As a father
myself, I help families use what they’ve built to look after each other
— sensibly.
General information only, not personal advice. We’ll assess your
specific circumstances before recommending anything.