Investment Home Loans

Key features

Standard variable investor home loans are virtually a mirror image of their owner-occupied counterparts, with an important distinction. Lenders tend to be more conservative in lending to investors and will generally only approve a loan to value ratio (LVR) up to 90%. Specifically branded investor loans may carry other features suited to investors, such as an offset or line of credit.

Advantages

Specialised investor loans tend to be competitive with standard variable loans in terms of interest rates and fees, but the inclusion of handy features such as offset facilities may give certain products the edge over the rest. An interest-only loan can help you maximise your tax deductions simply because you are paying off a higher proportion of interest each month. Lenders are now offering a range of bells and whistles to encourage investors, including home loan portability.

Considerations

While interest rates for investor loans are generally now on par with those for owner-occupiers, lenders generally seek to recoup costs in more creative ways. A common way for investors to be hit with hidden charges lies in the provision of extra features such as lines of credit. You may derive substantial benefits from such a feature, saving you money, but it's essential to weigh up any perceived benefits that the feature will provide versus the fee charged.

Suitable for

Ideal for anyone looking to fund an investment, and has 10% or more in cash or equity to throw in. Several properties can be combined for the serious investor, who would also benefit from salary crediting features like offset.

Investment Home Loans

Institution	Actual Rate	Comparison Rate *	Institution	Actual Rate	Comparison Rate *
	7.80%	7.90%		7.80%	7.87%
	7.67%	7.80%		7.80%	7.87%
	7.70%	7.91%		7.81%	7.94%
	6.99%	7.13%		7.86%	7.99%

* Comparison rates are based on a loan amount of $300,000 over a 30 year term. Comparison rate schedules are available via each lender’s website or by contacting Compare-Homeloans. WARNING: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates are effective as of 11-01-2011.

All information provided is a guide only and may not be complete for your purposes. Whilst displayed rates are regularly updated, neither Compare-Homeloans nor the Providers warrants the accuracy of any information and you should confirm it with the Provider before acting on it. Except for responsibilities implied by law which cannot be excluded, neither Compare-Homeloans nor the Provider is responsible for any loss, damage, cost or expense incurred by you as a result of any error, omission, or misrepresentation in relation to the data herein.