Main difference between top-ups and equity release deals is in the lender change:
Top-up means the loan is with the same lender, just the additional funds are required;
Equity release means the loan is with the new lender with balance refinanced and extra funds required.
Refinance means that current loan balance (and extra funds) are going to be provide by a new lender. Refinance option can be used instead of equity release (check with the lender if this is acceptable).
These options are selected in the Funding Worksheet.
Effect on Mortgage registration fees
Top-up application does not require Mortgage registration fees to be paid
Equity release and refinance applications require Mortgage registration fees to be paid
Effect on loan amount in Funding worksheet
For top-up and equity release, loan amount in Funding worksheet is the increase amount. This amount adds to the existing loan balance to calculate LVR:
Note that for refinance application, Proposed loan amount displayed are funds required (i.e. Balance+any increase).
Effect on product search
Total loan amount will transfer to Search loan product tab to ensure correct products are displayed:
Effect on product comparison and selection
For top-up applications, loan amount presented in Review loan products tab is the increase amount (not a total loan amount):
For equity release and refinance applications, loan amount presented is total loan amount:
Top-up vs Switch/Refix
When the lender remains the same and settled deal requires new fixed or variable product (or interest only extension) without increase in approved loan amount, application is 'Switch' (or 'Refix' in New Zealand).