Investment Property Loans
Simply fill in the enquiry form on the right for a FREE ASSESSMENT. You are absolutely under no obligation to accept offers that are presented to you by our expert staff. It’s confidential and there is NO CREDIT CHECK.
Property Investment Home Loans & Negative Gearing
The Australian Lending Centre offers a range of investment property loans to help people invest in the booming property market. We understand that property investors often have different goals to owner-occupiers, for this reason, we can tailor investment property loans to help you meet your specific investment goals.
With a thorough understanding of the property investment process, along with a wide range of home loan and investment property loan products, the Australian Lending Centre can easily help you maximise your returns from property investment. We pride ourselves on making the process easy to understand and we can provide step-by-step instructions designed to help first-time property investors navigate their way along the path to owning an investment property (or several!).
The Investment Property Loan Process
Step 1 – Find out what your options are
- Start by filling in our enquiry form to the right – this will allow you to quickly identify the best loan product with the help of our experienced investment property loan consultants
- Research the areas you want to invest in and identify investment properties of interest (see buying tips below)
- Use our online finance calculators to map out your finances and create a budget
- Talk to your financial advisor about any tax benefits that may be available to you when investing in property
Step 2 – Apply for your investment property loan
- Our experienced investment property loan consultants will take you through the application process and outline the necessary documentation to send through to process your loan request
- Sign and return the loan forms to us
- Once your investment property loan has been approved (or pre-approved), you’ll be ready to purchase your investment property
Step 3 – Purchase your property
- Congratulations on purchasing your investment property! You’ll now be ready to advertise and rent out your investment property
What are the Benefits of Purchasing an Investment Property?
There are many benefits of purchasing an investment property. Here, we’ll mention some of the more popular reasons to invest:
1. Negative Gearing – How Negative Gearing Works
When the cost of owning an investment property exceeds the income generated from renting it out, it is called ‘negative gearing’ and may provide some tax benefits. Take for example an interest-only investment property loan. If the interest payable each month is $1,500, but you only receive $1,000 in rent, then you are making a loss of $500 per month. Negative gearing can allow this $500 per month to be ‘deducted’ or removed from your taxable income. That is, if you earn $5,000 per month (your fulltime job plus investment property rent), then the Australian Taxation Office (ATO) will only tax you on $4,500 of your income.
This may sound attractive but negative gearing only works if your investment property grows in value, otherwise, you may end up loosing money. So choosing the right investment property and a flexible investment property loan is crucial.
In 2009, Australian property values in many areas experienced double-digit growth rates, but this does not guarantee strong future growth rates. For more information on negative gearing, contact a financial advisor.
2. Capital Growth, Capital Gains & Taxation
Put simply, ‘capital growth’ is the increase in the value of your investment property. A capital gain is the increase in value from the date when you purchased it, to the date that you sold it. So if you bought an investment property for $200,000 and sold it two years later for $220,000, you would have a capital gain of $20,000 – this would be added to your taxable income (along with your salary, for example).
3. Rental Income / Rental Yield
When your investment property is being rented out, it generates an income for you in the way of rent. If you are seeking a long-term investment, rental income can become an important component of becoming self-sufficient for your retirement.
4. Using Equity to Get Ahead
If you already own your own home or investment property, you can use the equity behind you to obtain additional investment property loans. We may be able to lend you up to 95% of the purchase price as you can use your paid off home (or other investment property) as security for the new investment property loan.
Investment Property Loans & Buying Tips for Investment Properties
- Research the area and the property – have property values in that area risen in the last few years? Is it a desirable area (close to schools, transport, shopping facilities, parks, beaches, employment opportunities etc)? How much do people pay for rent in that area for similar properties? (you can check www.realestate.com.au to get an idea of this)
- Find the right investment property loan – start by filling in our enquiry form to the right – we have a range of investment property loans that may fit into your financial plan and our experienced investment property loan consultants can help you to identify the best loan product on the market to suit your needs.
How We Can Help You Purchase Additional Investment Properties
When determining the amount you can borrow for subsequent investment properties, we can factor your rental income and negative gearing benefits (if available) into the loan amount - this means you may be eligible to borrow more than you think. We may be able to provide you with an investment property loan that offers up to 10 years of interest-only repayments, which allows you to enjoy the added benefit of making the entire loan repayment tax-deductible for a longer period of time.
Learn more from the Australian Lending Centre about: