TLDR
- Investment lending assessments can differ from owner-occupied lending.
- Lenders consider a range of financial factors during the application process.
- Equity may be used as part of a financing strategy in some circumstances.
- Lending criteria vary between lenders.
Financing an investment property involves a lending assessment similar to an owner-occupied loan, however some lender requirements and considerations may differ.
Assessing financial circumstances
Lenders generally assess factors such as income, living expenses, liabilities, credit history, and existing loan commitments when reviewing an application. Each lender applies its own lending policies and assessment criteria.
Using equity
Property owners who have built equity in an existing property may be able to access a portion of that equity for another property purchase, subject to lender requirements and available equity levels.
Rental income considerations
When assessing an investment loan application, lenders may consider expected rental income from the property. The way rental income is assessed can vary between lenders and may include shading or other assessment methods.
Interest-only and principal and interest loans
Investment loans may be available with either principal and interest repayments or interest-only repayments for a specified period. Features, costs, and eligibility requirements differ depending on the loan product and lender.
Whatever stage of the property journey you’re at, the team are here to help. Reach out to us today.