Who lends you the money to finance your investment property purchase can be just as important as which property you buy. Putting a foot wrong in the very early stages of sourcing finance, could end up costing you thousands over the term of your loan. Getting assistance from an expert in the lending field could be the best decision you ever make.
Can't I just borrow from a bank?
While you may be satisfied with the level of service you receive from your existing bank, they are only able to sell you products that exist in their range. Banks are businesses. They can only offer you the loans and products that are available at their particular bank. Because of this limitation, how can you be certain you are getting the best deal possible when you are only being shown a snapshot of what is available in the market?
Getting finance to purchase an investment property is very different to getting a Car or Personal Loan. Although banking staff may have information in these fields, they are not trained Accountants, Financial Planners or Real Estate Agents. Without this specific knowledge, they are unable to view your circumstances holistically in the way that a specialist investment property lender can. It is also unlikely that banking staff are aware of how different types of loans can be structured in order to maximize taxation benefits and protect your new asset.
What about a Broker?
A broker has access to more products and lenders than that of the individual banks. A skilled broker should be able to evaluate your circumstances and find a loan that best suits your needs. However, it’s important to understand that brokers make their money by writing loans and may be swayed towards certain lenders that pay higher commissions. Similarly to the banks, brokers also may neglect the fact that how a loan is structured can ultimately affect the outcome of your tax benefits.