Investment home loans

The interest rates, terms and options available on your place of residence and any investment properties you have are now pretty much the same with some extra options like interest capitalisation etc.  While the range of opportunities are similar, you might however typically utilize different kinds of borrowing options that are more in line with your wealth creation, tax and interest minimisation strategies. In order to best maximise your investment home loans, talking to your accountant and or your financial planner first should set you up to get the best out of your finance arrangements. 

Make sure you submit your entire borrowing portfolio

Whether you have all your investment home loans with the same lender or not, make sure your mortgage broker is aware of your entire home loan portfolio.  The size of your portfolio can give you considerable negotiating power for interest rates and fees as the total increases.

Investment home loans summary

There are a myriad of Investment home loans available to you and you can find out about most of them on this site.  From very cheap to highly flexible, the right investment home loan really depends on your particular needs. Talk to your mortgage brokerfor more information on the loans below, or to find out which best suits your situation.

Line Of Credit 
Home Loans – Fixed Rate – Interest Only – Annually in Advance
Home Loans – Fixed Rate – Interest Only – Monthly in Arrears
Home Loans – Variable Rate – Principal & Interest
Home Loans – Variable Rate – Interest Only
Home Loans – Fixed Rate – Principal & Interest
Interest Capitalisation or Cash Flow Management Loans
Superannuation Fund Loans
Commercial Bills
Margin Loans

Honeymoon and introductory rates

Don’t be afraid to utilise honeymoon or introductory rates for your investment purposes. These kinds of home loans are not just for first home buyers or smaller borrowers and there are a surprising number of options available that may suit investors.

“Amazing tenacity to get the deal done. He is like a dog with a bone. Doesn’t get pushed around by the banks, and has some clout with his business relationships to get the best result. I have passed Paul Moulday’s card to everyone I know in my circle of associates.”
Simon Howden, Malvern, Melbourne

Interest capitalisation loans – bridging and home loans

There are a number of interest management and interest capitalisation products available – whether through a bridging period or for specific loans.  Many bridging loans now offer a ‘no payment’ period on the property you are selling, once you have purchased a new one.  The interest on the outstanding debt is simply capitalised and added to the total debt for when it is repaid.

There are a couple of investment loan products available that allow you to capitalise the interest and or costs not covered by the rentals on your property for up to 7 years. In effect, the investment property purchase becomes a cash-neutral investment, ie: there could feasibly be no ‘additional ‘ top-up payments being made for up to 7 years. And even at 7 years, you can potentially refinance and start the loan again. For this loan product, it is important to understand that you are potentially relying on property capital gains and it is extremely important to seek advice from your accountant as well as your mortgage broker. 

No LMI to 85%

X Inc works with two lenders who will do up to 85% borrowing without requiring the payment of the traditional lender’s mortgage insurance that is normally payable for borrowings over 80%. This offer can literally save you thousands of dollars that can be used to top-up your loan repayments.

“Clint Bravo has been my trusted finance advisor and mortgage broker since 2003. His professionalism, approach, knowledge of the industry, banks and their products has helped us build wealth and do it in a secure & relaxed way.”
David Hathway, Melbourne, Victoia

Investment versus personal use

Investment loan decisions are often influenced by whether the borrower has any owner-occupied debt. Owner-occupied debt is usually paid off first to maximise the effectiveness of gearing, while the tax effective debt (investment debt) usually has the minimum repayments possible, often interest only repayments. If there isn’t any owner-occupied debt, then personal circumstance and choice dictates interest only, principal and interest or a combination of the two. Talking to your accountant or financial planner is particularly important when you are planning on making decisions about funding for investment purposes versus owner occupier or personal use.

More information or confidential meeting with an investment mortgage broker

If you would like to talk confidentially with a broker who understands how investment borrowing works, our sister company Loan Market Home Finance Brokers also works extensively with investment loans. Go to the investment loans area on the Loan Market website.