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Rules Of Investment

When you’re trying to secure finance for an investment property, it’s important to keep a few simple rules in mind to make sure you get the best deal possible and will be able to afford the repayments, come what may.

If you’re thinking about purchasing an investment property, it’s important to manage the risks adequately. For example, you shouldn’t rely on rental returns as a guaranteed income to meet loan repayments, as there are times when a property may be vacant or hard to fill immediately and some months the rental return on a property may be diminished by maintenance costs.

“A credit adviser will help a borrower find the right product, so that he or she can afford the repayments,” said one helpful adviser. “The adviser will add a two per cent rate hike onto the rate the borrower will be looking to take, to make sure they can still make repayments if, or when, mortgage rates go up.”

Most investors will already have put some thought into where they would like to invest and will have an approximate price-range in mind. While a loan calculator is a great resource to start out with, a credit adviser can use their expert knowledge to sense-check and flesh out your plans.

With access to property data and trend analyses like RP Data’s, a credit adviser can pull property reports for you, detailing how the area has performed in the past as an investment, the average median house price or rate of return and how much the property values have increased over the past five or six years. These are details that investors generally can’t access.

Even better, if you meet a local credit adviser in the area where you want to invest, he or she will know that particular market and be able to provide a lot of detailed information from working there every day.

Peninsula Home Loans are MFAA approved credit advisers who can help you get the most out of your property investment.

An MFAA Approved Credit Adviser is much more than your average mortgage broker.

Written by

Stephen Bonfield, the Managing Director, previously worked for one of Australia’s major home loan companies as an independent mortgage broker. Steve used this experience to set up his own mortgage broking company - a company that places customer needs at the forefront.

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