Ashleigh, Tina is right on the money with her answer. Hopefully we can attract a mortgage person in the area to get you a good answer.

Ashleigh:
It's possible you may be able to use some of the equity toward the building costs of a new home. First, it's best to be sure you understand what home equity is. Equity is the difference between the fair market value of your home and the amount owed on your mortgage loan. Lots of folks use this equity to consolidate their debts, or pay for a large/major renovation or a large purchase. Some use it to pay for education for their kids or themself, refinance their current mortgage and even purchase real estate (2d vaction home, etc.) In your situation it would possibly be like buying the investment property. Your best avenue here would be to sit down with a mortgage officer either at a bank or mortgage company and have them go over the program to determine if it's the right decision for what you're thinking of doing. Hope this helped! Great question! Good luck!
Tina Evans, Principal Broker