Property Investors
No Deposit and Low deposit investment property loans are very popular amongst residential property investors who are purchasing residential property for investment purposes.
Minimising the amount of equity tied up in an investment property enables a property investor to maximise their leverage and potentially acquire more property than would normally be possible. Generally the theory behind "maximising leverage" in a property market is that the more property that is held in times of increasing property values then the potential capital gain that can be achieved is greater, provided the properties are in an area that is increasing in value. This capital gain could be drawn upon to then purchase more investment property and further increase the leverage and resultant exposure further property value increases. Property values need to increase at a level that will also cover the costs of the finance eventually otherwise there could be a negative return on the investment. Property prices that do not increase or even decline would also result in a negative return. There may be some taxation benefits realised as well and this really should be discussed with a professional accountant or tax planner.
No Deposit Home Loan for property investors
Most no deposit home loans are available in versions for owner occupier borrowers and for property investors. Property investors may be attracted to the higher loan to value ratio no deposit loans such as the 105 percent and 106 percent no deposit residential home loan products to cover the set up costs and taxes involved.
Ability Finance are able to provide customers with access to a wide range of low deposit investment property and no deposit investment property loans for investors. Additionally all Ability Finance clients can obtain comprehensive property sales data reports within the greater Sydney metropolitan area at no cost.
Investors may also be interested in the 50 year loan term no deposit property investor loan where 100% of the valuation can be lent plus the stamp duty costs.