Property Investment Loan

The couple’s goal for their investment purchase was to gain a rental income to assist them in starting a family and to allow them to retire earlier.

When we first met with Liz and James we focused not only on their financial goals but the lifestyle goals they wanted to achieve over the coming years. We discovered that Liz was in the early stages of pregnancy and planned to take maternity leave later in the year. They considered this a big obstacle and believed they had left their investment purchase too late. We advised them otherwise.

We performed some quick assessments and gave them some key take away points including:

1. A property valuation estimate report on their existing home.
2. Their borrowing capacity (max loan amount).
3. Estimates of the costs associated with their prospective purchase.
4. A target price range of their new investment property.

After speaking with their accountant we decided that we could present a powerful tax-effective investment lending strategy for Liz and James.

This proposal incorporated the refinance of their existing home loan to a new lender with more competitive interest rates as well as a pre-approval for a new interest-in-advance investment home loan.

We refinanced their existing home loan and obtained the pre-approval for their investment purchase which allowed them to successfully win their new property at auction.

The benefits of our lending solution were:

1. We used an equity release from their current home as their deposit. This meant they could keep some of their savings for the expected costs in preparing for their new baby.
2. By pre-paying the following year’s interest for the tax-deductible investment loan they achieved substantial tax savings.
3. Furthermore, because they prepaid their interest they didn’t have an ongoing interest cost during the maternity period. This allowed them financial comfort.
4. We were able to save them money on their existing home loan by providing heavily discounted interest rates.