Selling but not discharging loan

Thanks Terry, but could they substitute the security the bank already holds if they don’t want to purchase again to leave access to the funds for contingency?

Thanks Ethan. I know it’s a weird one.
I’ve seen it before when they were crossed so they only needed to reduce enough to keep the LVR under 80%.
But I was just asked the question and I hadn’t come across anything like it before when the properties weren’t crossed. So a bit like substituting security as Terry said but using another property that the bank already has mortgaged, not cash.

If it helps it make more sense i’ve created some hypothetical numbers..?
Property A worth $400,000 debt of $50k
Property B worth $250,000 debt $220k
If they sell and discharge they have $30k in the bank.
If they could transfer the $220k over to the other property, with it 100% offset until such time they want to draw upon it rather then reapply for equity release down the track.

I guess its just in this new environment where a lot of people don’t qualify for what they already have pre APRA, you don’t want to fully discharge debt as you may never get it again!

Lending with STG other with ANZ.
Spoken to multiple brokers, finance strategists if you want to call them that, some even with the luxury of no response once details have been given.
looking at speaking to them directly again, as last time was 12 months ago, just to see if anything has changed.