Most Australians have a goal of someday owning an investment property. But there’s usually one major roadblock to achieving this: money.

Saving enough money for a deposit is certainly the biggest part of the groundwork when looking at buying an investment property, but the next biggest part is securing financing.

This can be a confusing territory to navigate, but thankfully, we’re here to help. Let’s discuss with the experts at Patrick Leo and bring you 8 tips for securing financing for your investment property:

1)    Saving for a solid deposit

The first step to securing financing starts with your deposit, so it’s only natural we focus on this first. Saving money is certainly one of the biggest challenges when buying an investment property, but it’s not unachievable if you make important sacrifices and compromises even for just a short period of time. Consider moving to a cheaper area to pay less rent, splitting costs by living with more housemates, and making fewer discretionary purchases.

2)    Checking your credit score

Understanding your credit score, and trying to improve it if necessary, is crucial. Most lenders need applicants to have a credit score of 680 or higher before agreeing to finance them.

3)    Shopping around

Don’t settle for the first offer you get; shop around and compare the market. The team at Patrick Leo is a wealth of knowledge when looking for great financing options, so don’t hesitate to contact us.

4)    Mortgage brokers

Mortgage brokers can do the shopping around for you, negotiating hard to find you the best possible deal on your investment property loan.

5)    Explore the possibility of a guarantor

If a family member is willing to guarantor your loan, they can put up their property as security and allow you to make a purchase with a small deposit. 

6)    Use equity to your advantage

Already own a home? Great! You can use the value of your current property to help fund your next investment property purchase. This is called equity.

7)    Looking outside the box with fractional property investment

Fractional property investment can be an effective, low-cost way to break into the property market, allowing you to pool your money in with other investors and own a small share of a property.

8)    Accessing super

A self-managed super fund (SMSF) is also an option for financing your investment property portfolio. With an SMSF, you can use your superannuation to purchase investment properties, which can provide tax benefits and long-term financial security.

At Patrick Leo, we’ve spent over 20 years increasing the wealth and happiness of our clients by finding them high quality investment properties and helping them build a portfolio. If you’re interested in starting your real estate portfolio, get in touch with the experts at Patrick Leo today.