Australia's second mortgage lenders, compared

Australia's second mortgage lenders differ most on four things: the smallest loan each will write, the most it will lend against the property (the combined LVR), whether a valuation is needed before settlement, and where the property has to be. None of the others here that publish a minimum starts below $50,000, three start at $100,000 or more, and several will only take metropolitan property. Those four things decide more applications than price does. HomeSec lends from $20,000, uses no valuers, sets no minimum term and lends Australia-wide.

There are two questions worth separating. The first is what a second mortgage is and whether it fits the problem — that is the product page, and it is where the mechanics belong. The second is the one this page answers: if you have decided a second mortgage is the instrument, who actually writes them in Australia, and what does each one require before it will?

Every figure below was read off that lender's own website. Not off a comparison site — those go stale quietly, and in this corner of the market they are often repeating a product sheet that changed a year ago.

What each lender requires

Taken from each lender's own website on 29 September 2026. "Not published" means that lender's site does not state it, not that the answer is no. Lenders change their products without notice, so check the lender's own site before relying on any row. HomeSec is not affiliated with, endorsed by or connected to any lender named here.

The smallest loan a lender will write is the first thing to check

Every conversation about second mortgages is about interest. Almost none of them is about the number that actually ends most enquiries, which is the smallest loan the lender will bother writing. Of the lenders above that publish one, the smallest loan they will write runs from $50,000 to $250,000.

So a business with $400,000 of clear equity in a property, which needs $35,000 to clear a tax debt before a deadline, is outside most of this market before anyone has looked at the security. Not declined — never assessed. That is worth knowing before you spend three days on applications, and it is why HomeSec writes from $20,000.

A valuation adds about a week

Three of the six name a valuation as a required step or a published upfront cost, and one states its settlement window as beginning once the valuation is back. On a second mortgage a valuation is rarely the thing that changes the answer — the equity is either there or it is not — but it reliably adds a week and a fee to a transaction that was urgent enough to be looking at a second mortgage in the first place.

None — we don't use valuers. That is a credit decision, not a shortcut: the security is assessed here, by the people who will have to be right about it.

A minimum term costs money on a short need

Several of these lenders set a minimum term — six months is common, and one sets a minimum of one month. A minimum term is easy to miss until the thing you are funding resolves early. If a property settles in seven weeks and the loan had a six-month minimum, the six months are what you agreed to pay for.

HomeSec sets no minimum term and no maximum one. You can repay anytime, with no penalty, and unused months of capitalised interest are rebated, so a loan opened for six months and repaid in seven weeks costs seven weeks.

Where the property is can end the conversation

This is the rule people notice last. One of the lenders above lends nationally but will only take metropolitan security. Another applies its larger facilities only inside listed distances of the capital cities, plus a named handful of regional cities and holiday destinations, with everything else considered case by case.

Those lines are drawn for a reason — a lender in second position is thinking about how liquid the security is, which is really a question about how many buyers a postcode has — but the effect is that a good business on a good property in a regional town is reading pages written for somebody else. Ask where the lender takes security before anything else, and you will save a day.

Who your first mortgagee is can matter too

A second mortgage sits behind an existing lender, so some lenders take a view on who that existing lender is. One of the six requires, on its larger facilities, that the first mortgagee be a bank or a bank-like lender on interest, fees and covenants. If your first mortgage is already with a private lender, that rules you out before anything about your business is considered.

Whose money is it, and who actually decides

Worth asking, because it determines how fast an answer can come. Some of the lenders here fund from their own balance sheet and say so plainly. Others are managers or trustees placing investor money under a mandate, which is a perfectly ordinary way to run a lending book and a slower way to get a decision, because the mandate is the decision and it was written before your file existed.

HomeSec lends its own money, which is why a real answer comes back on the first call rather than after a credit paper goes somewhere else. The difference between the two kinds of private lender is worth understanding before you choose either.

Nobody in this market has one price

Four of the six publish a rate or a range and the published figures are not close to one another. That is not evidence that one is cheap and another is dear. It is evidence of the thing every lender in this market knows and not all of them say: a second mortgage is priced on the file — the security, the position, the combined LVR, the strength of the exit and the term — and a single carded number cannot be true across all of them. The cheapest finance is rarely the one with the lowest advertised rate.

What HomeSec does instead is set out what a loan is made of, which parts are the same on every file, and what moves the one part that is not.

What to ask any second mortgage lender, in order

• What is the smallest loan you will write? If your number is under it, stop here.
• Will you take security where my property is? Before the property details, before the business.
• Do you need a valuation, and does your settlement time start before or after it? Two different questions, and the second one is the one with the week in it.
• Is there a minimum term? Then ask what happens if you repay early.
• Does it matter who my first mortgagee is?
• Do you lend your own money, and who signs off?
• Can I apply directly, or only through a broker?

Seven questions, and most of them can be answered in one phone call before anybody fills in anything. A second mortgage is a straightforward instrument; the difficulty is almost never the instrument, it is finding the lender whose rules your situation happens to fit.

Reviewed by Paul Stone, Joint Chief Executive