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TIPS FOR PURCHASING YOUR SECOND AND FUTURE
INVESTMENT PROPERTIES
We recommend that you
review your mortgage
requirements and equity
with us on a yearly basis.
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a contract, seek independent legal advice as
soon as possible.
Use the equity in existing property
Make your current property work for you!
There’s no need to own your home outright
or sell it to access enough equity for an
investment purchase. Equity is simply the
difference between what your property is
worth and what you owe. For example, if you
have a property valued at $600,000 with a
mortgage of $400,000, you have $200,000
worth of equity. You may be able to borrow
up to $80,000 against this equity to purchase
an investment property. Using this equity
and combining it with the added rental
income could mean that you can buy another
property sooner.
Mortgage offset account
A mortgage offset account can save interest
on your loan. Your mortgage is linked to an
account into which your salary and other
cash can be deposited and from which you
withdraw to pay bills and credit cards when
these debts fall due. Use these savings for
another deposit instead of paying off your
current mortgage.
Save your annual lump sum payment
and windfalls
Use your tax refund or a windfall such as an
inheritance or work bonus to help purchase an
investment property.
Save a little extra every month
$150 per week can usually support an
additional property providing you have the
deposit. Set up a separate savings account and
set a target for a deposit. This history of savings
will help you to finance another property.
If interest rates drop
If you have a variable rate loan and the interest
rate drops, save the difference for a deposit
towards another property rather than paying
off the investment loan.
Stay informed
Once you have a mortgage, aside from
making the payments, it’s easy to forget about
it altogether. Staying informed about interest
rate movements and new products could
save you money. Over the lifetime of your
loan we advocate exploring new products and
facilities that may better suit your changing
needs.
