What features should you look for in an investment loan?

By Marie Mortimer | 23 Mar 2022

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Promoted by loans.com.au

Any investor worth their salt will know that it’s important to find an investment loan with a low interest rate. While a competitive interest rate is certainly an important thing to have, there are many other features investors should look for in an investment loan.

Here are some of the most important features to look for in an investment loan.

Interest only repayments

Most standard home loans have principal and interest (P&I) repayments. But some savvy investors want the option to pay interest only on their investment loan as it means lower repayments, freeing up cash flow for other investment opportunities.

On top of that, interest is tax-deductible. According to the Australian Taxation Office (ATO), if you’re buying an investment property to use as a rental, you can claim interest charged on the loan.

Our Smart Booster Investor Bundle allows you to make interest only repayments for up to five years.

Flexibility on how to repay the loan

Making more frequent repayments can also help you pay the loan off sooner. For example, making fortnightly repayments allows you to make an extra month of repayments, as there are 26 fortnights in a year, which is equivalent to 13 months.

With our Smart Booster Investor Bundle, you can make weekly, fortnightly or monthly repayments.

Offset account

Another important feature to look for in an investment loan is an offset account, which can be used to replace your everyday banking account and comes with its own debit card that you can use to withdraw money and pay for regular purchases.

An offset account works like a savings account where you can stash extra funds. The balance in your offset account is counted towards your principal loan amount which reduces the interest charged on the loan. Investors can kill two birds with one stone by using an offset account: they reduce the interest they pay while saving up enough to fund another investment or a renovation.

For an extra 0.10% p.a., we offer an offset sub-account on our Smart Booster Investor Bundle

Minimal fees

Property investment isn’t cheap, so it’s important to be mindful of all the costs involved and look for an investment loan with minimal fees. When you’re shopping for an investment loan, ask the lender for a product brochure that should outline all the fees that the loan has. Make sure to ask the lender which fees can be paid upfront.

Our Smart Booster Investor Bundle has no application fee, no monthly or ongoing fees, and no fee if you want to make additional repayments. Being an online lender, we save in overhead costs and can pass these savings directly on to you.

Find out more

With a competitive variable interest rate of 1.99%* (2.71% p.a. comparison rate*) our Smart Booster Investor Bundle is our lowest rate investor loan and as you can see, comes packed with useful features for investors. If you’re ready to buy your next investment property, this could be the perfect loan for you.

Book a time to chat with one of our lending specialists today.

*Conditions apply. The comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate.

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Marie Mortimer is Managing Director of loans.com.au, one of Australia's largest online lenders. Since Marie started the business in 2011, Marie has grown loans.com.au into a company with $6 billion worth of home and car loans. Marie is dedicated to improving financial literacy for all Australians and is passionate about the FinTech industry in Australia. When she isn't at work, she loves to spend time with her husband and two young children.

loans.com.au is an online lender for home and car loans. For more than 10 years, Aussies have trusted the locally based loans.com.au team to support them with low home loan and car loan rates, approved quickly through the online loans.com.au app.

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