What is Equity? Simply put, it is the amount of your house that you do not owe money on. How you access that can vary; a variety of different loans may be available to you, depending upon what you want to use it for, and what your plans for the future are. You can purchase an investment property, use it to invest in shares, or even as the current advertising says, to buy a boat. You can also use it to improve your existing home.

You often read, and see, ways to increase the value of your home through renovations, shows and articles full of wonderful ways to improve your home, ideas that most people would love to try but who then say "but I could never afford to do that!"

Before you decide to write off those home improvements as impossible, let's look at an example of how you may be able to use the equity you already have in your home. Depending on your personal circumstances you may be able to borrow against your equity to fund your renovations, and thereby increase the value of your property.

It is reasonably easy to access up to 80% of your property value. Let's look at an example. First of all, calculate your equity.

Most improvements you make to your property should increase its value, although it is always best to have a well thought out plan detailing the changes you want to make. You may also want to consult a professional to ensure that they will have the desired effect. You don't want to look back and wonder why you thought that extra bit of hallway that goes nowhere seemed like such a great idea.

Once you have an estimate of the costs involved, you can sit down with your finance broker or lender, to discuss finance. For example you could extend your current loan, add a line of credit, or refinance. You may even want to incorporate any existing credit card or personal loan debt as well to help reduce those repayments.

It is important to sit down and look at any increased in repayments to make sure they can be comfortably absorbed into your budget and will not impinge greatly on your standard of living. When doing your budget, remember to give yourself room for unexpected costs, future plans and a lifestyle outside of your bills. You may even want to go through your budget with your accountant or financial planner.

Just remember, it is possible to achieve those renovation dreams.