February 24, 2015

Investment home loans

Investment property loans

Are you looking to invest in property in Australia and need finance?

We can assist people who want to finance a real estate purchase in Australia.

If you are an Australian tax payer there are certain tax considerations when investing in real estate. These allow property investors to claim tax deductions from their investment property. Though we do not advise on taxation matters (see your tax adviser for that), we can set up your home finance so that it maximizes your benefit.

There are also other considerations for property investors when structuring their home loan and investment property loans. Some considerations include cross-collateralisation, or rather avoiding it. This is especially important if you plan on purchasing more properties in the future or selling one of the properties that you already own. Cross-collateralisation is designed to benefit the lender, in that all of the cross-securitised properties secure all of the loans, this means that if something goes wrong they can recover costs using any and all of the properties. Cross-collateralisation also has other negative points for property investors and advantages for the lender. Because all of the properties and loans are linked the lender may require you to maintain the overall loan to value ratio (total borrowings compared to total value) of the property portfolio. This may mean that if one of your properties has decreases in value but another has increased the overall portfolio may be neutral and give you no opportunity to utilise equity for further purchases. If your properties are not cross-collateralised and each property has a separate loan, then you may be able to leave the property as is if it went down in value but refinance and unlock some equity for a property that has gone up in value and purchase another investment property.

Other considerations include the lenders chosen and the order in which you use them in order that you are able to finance your current purchase and maintain future borrowing power for future purchases.

Contact us to discuss your investment property loan options.

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