Investment Loans
The two types of Investment loans that are particularly attractive to investors are Interest Only loans and Line of Credit loans.
- Interest only – With most standard home loans your repayments are made up of interest charges plus a small repayment of the loan balance. In this way the original amount borrowed over the term of the loan is slowly being reduced. A period of interest only means the loan principal remains the same unless additional payments are made. You only have to pay the original amount borrowed if you sell the investment property or if the interest only period expires. Investors like this type of loan because during the interest only period of the loan because: Monthly repayments are less than they would be if principal was paid as well.
- Line of credit – If a property is already owned, a line of credit offers a way to use any equity you have built up in that property as a deposit for an investment property purchase. Investors like this type of loan because: A line of credit loan allows you to draw from a fixed amount at any time to pay for any additional expenses. You could liken it to a credit card with a large limit, but the security is the equity in your home.
Mortgage Interchange can help with many Investment loans through our wide range of lenders.