There’s a lot to consider when it comes to lodging an application for an investment loan.
When applying for a loan, whether for investment purposes or as an owner-occupier, a lender will assess your borrowing capacity and your ability to tend to the loan. But as mortgage broker Samantha Cranny from Smartline Personal Mortgage Advisers shares, there are a number of things that an investor needs to be mindful of when applying for an investment loan today.
“Years ago, the rate was the rate whether it was owner-occupied or investment, now it’s a completely different ball game and if it is an investment, now they load the rates and if it’s interest only, they again load the rate,” Cranny explains to Your Investment Property magazine editor Sarah Megginson.
But what does it mean when a lender loads the rate? According to Cranny, it boils down to an increase in the interest rate, which can be up to 0.25 to 0.30 points or even higher than an owner-occupied rate.
Cranny shares that borrowers need to be on top of their finance game when they have investments, and she reveals the professionals to get on board – from agents and financial experts, to a qualified and professional mortgage broker – all of which can save you time and money.
“[Lenders] have different specials on at different times. That’s the other beauty of going with a broker, we get to see all of those things,” Cranny explains. “We’re updated daily on what’s happening with rates and specials, so it’s not just one lender’s rates and specials, we’re exposed to all of the lenders’ rates and specials. There are a lot of offerings there.”
However, while securing a competitive rate is understandably front of mind for the borrower, Cranny says there are other important things that need to be considered when signing into an investment loan with a particular lender, such as the quality of service they are providing to you.
To find out how to increase your chances of being approved for an investment or owner-occupied loan, what to be aware of before applying, and sure-fire ways to strengthen your loan application, watch Samantha Cranny’s full interview.