Financing Your Property Investment in Melbourne

Financing is a concept every investor should be familiar with. It’s not always possible to purchase an investment property using cold, hard cash – in fact, this is relatively rare.

Knowing and understanding your options for finance when buying an investment property in Melbourne is key to making smart financial decisions and securing an investment that suits your position and goals.

In this post, Australia’s leading property advisers at Patrick Leo outline what you need to know about financing your property investment in Melbourne.

Acquiring a cash deposit

In most cases, a cash deposit is a fundamental part of securing an investment property. This may come from hard-earned savings, returns on other investments such as stocks and bonds, or the sale of another property.

As you know, a 20% cash deposit is generally the minimum required amount to secure a loan for an investment property. But if a 20% cash deposit isn’t available, you can take out Lender’s Mortgage Insurance (LMI).

LMI is an insurance policy that protects the bank in case you can’t meet your mortgage repayments. It comes in the form of either a one-off premium or a fee added to your loan amount.

Conventional bank loans

Most investors turn to bank loans when financing an investment property in Melbourne. Loans are a long-term debt, so it’s important to pay attention to the interest rate – a lower interest rate, even if it’s just 0.5% lower, could save you thousands of dollars in the long run.

We suggest comparing at least three or four different lenders and their options for investment property loans. If you’re strapped for time, or you’re not getting good enough options, Patrick Leo can connect you with top mortgage brokers who are experts at finding great deals on investment property loans.

Using equity

Equity is another option for financing your investment property in Melbourne. This is where you use another property, for example your home, as a way to borrow against your investment property.

Sitting down with the experts at Patrick Leo can help you better assess your financial position and understand what your current equity could allow you to borrow.

There are multiple ways of financing an investment property in Melbourne, which is your ticket to abundant wealth and financial freedom. Patrick Leo is Australia’s top team of property consultants who help Aussies all over the country to secure an excellent investment property to suit their personal situation and financial goals. Our leading team of property advisers are committed to helping you on your path to abundant wealth, having helped hundreds of clients achieve the same. Get in touch with our team and get started today.