Most long-term wealth is gained from real estate. It provides a stable and secure investment.

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Property investment

Growing your wealth and self funding your retirement through property investment is a proven formula for financial success. It still requires self discipline and sensible management Purchasing an investment property will most likely require an additional home loan.  The added benefit is the existing equity in your home can be utilised as part of the security to allow the purchasing of the investment

There are a range of loans potential investors can take advantage of aside from the standard variable and fixed rate home loans.

We have listed a few of the most common loan types to give you a basic understanding of the options available to investors.

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Fixed and Variable investment Loans

As the title states investment loans can be structure almost the same way as your regular home loans. The added benefit is the existing equity in your home can be utilised as part of the security to allow the purchasing of the investment property. A rental agreement/rental receipts or letter from the property manager confirm the income generated from the leasing of the property is considered in the servicing of the loan as well as your own income.

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SMSF Loans

These loans draw funds from Self-Managed Super Funds (SMSF) and require more complex documentation than regular home loans. The loan uses a limited recourse borrowing arrangement, meaning if you default the lender is only entitled to the asset in question.

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Strategies-highly important!

I am all about your well being and security. At all times I will consider what is the most safest and secure method for you to finance your portfolio. I can draw on from 2 generations of investment property experience and also the modern resources available to me now. I can assure you that I want you to succeed and prosper. Regardless what your property is, residential or commercial. Having a risk minimisation plan is essential.

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Important

Just because you can, doesn't mean you should. Property investing is a serious financial commitment and requires due diligence. You need to get independent financial advice from your accountant and consider your risks and how to protect yourself. For example, landlord insurance, correctly structured loans to reduce impact. Be very cautious when having consider to cross collaterise properties as security for the next loan. 

Cross-collateralisation occurs when more than one property is used to secure a loan or multiple loans. For example, a person owns Property A and wants to purchase Property B without using any of their own funds. Сross-collateralisation Strategy. The bank can use both properties as collateral for the new loan. This places both properties at risk of being seized and sold by the lender. It does have its potential to grow wealth quickly in fast appreciating property market. Your accountant can confirm if you will get a decent refund through reducing your taxable income as you are in part supported by the Australian government to self fund your retirement

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