In the market for a home loan for investment properties. What is the best rate for investment properties (principal and interest) from major banks? The best I could find are UBank and Macquarie, at around 3.74%. Would need offset account. Thanks
What Is The Current Best Home Loan Rate for Investment Property?
YLC on 02/07/2019 - 02:12
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Talk to a mortgage broker. They're usually free.
Off duty mortgage broker here. Macquarie rate is very good, but your LVR needs to be below 70%.
RBA likely to cut rates today or next month and that might change who has best rates depending on how much rates are reduced by respective lenders.
Speak to a broker - everyones situation is different and if you just shop around for rate you might end up applying for mortgages you dont qualify for, have high fees or are unsuitable.
Hi SydneyMoney, could you please pm me regarding the Macquarie loan rate? I had a look at Macquarie website but couldn't see specific deals for LVR below 70%. Is it only available via broker?
I tried to pm but your pm function is not on.
Thanks
Ubank doesn't offer offset only redraw. FYI Redraw is not the same as offset, there are huge tax differences between them.
Can you please explain the differences tax wise? Tried to google but couldn't find anything.
I'm not an accountant so others might be able to explain this more elegantly but essentially its as follows.
With an offset you still incur a on paper interest cost per month, the bank then provides you a credit against this interest cost which reduces what you pay.
With a redraw the bank calculates how much interest you pay each month on the amount you owe and sends you a bill.
In both cases you pay the same amount, but only in the offset version do you incur the full interest loss. Tax rules allow you to remove the money from the offset at any time and use it for whatever you like while still incurring a loss on the interest payment. For redraw however tax rules treat any money you redraw as being spent and any increase in interest costs is not tax deductible. This makes redraw far less flexible and a bad choice if you ever want to negatively gear the property as you can claim far less losses than if you had an offset.
Also be careful of recent changes that can reduce the amount you can redraw, see this commbank link https://www.commbank.com.au/banking/changes-to-loan-repaymen… and https://www.finder.com.au/commbanks-new-home-loan-redraw-rul…
Thanks, appreciate the reply. Looking to purchase soon so the more information the merrier.
Virgin Money is around the 3.74% with offset.
Macquarie is a good option.Depends on if you want ongoing fees, how large the loan is, if you want an offset, and interest only…
Mortgage Broker here,
I can also advise that Macquarie are highly competitive for both fixed and variable home loans.Fixed rates:
- 1-3 Years - 3.59%Variable
- 3.44% (Sub 80% LVR)
- 3.34% (Sub 70% LVR)If you have any questions please reply to my comment as I would be glad to offer assistance.
Kind Regards,
Nick
is it for investment property? the rate on their website is 3.54
Hi Hoangdekiem,
The RBA cut the cash rate to a new record low of 1% last week.
Macquarie didn't drop the full 0.25% but did drop 0.20%.
Kind Regards,
Nick
is that before the july drop or after?
Hi Roidcel,
These rates are after the drop. Feel free to get in touch if you have any other questions.
Kind Regards,
Nick
Hi YLC,
I'm a mortgage broker based in Melbourne.
Macquarie bank has reduced their rates as of 5/7/19.
Below are the updated rates based on the loan LVR and loan type.
Investment property
Up to 70%LVR, P&I - 3.54%
Above 70%LVR and up to 80%LVR, P&I - 3.64%
Above 80%LVR, P&I - 4.35%
(Investment P&I Fixed Rates from 3.49% for 1-3 years, 3.59% for 4-5 years)
Up to 70%LVR, I/O - 3.74%
Above 70%LVR and up to 80%LVR, I/O - 4.04%
(Investment I/O Fixed Rates from 3.69% for 1-3 years, 3.89% for 4-5 years)Owner Occupied Property
Up to 70%LVR, P&I - 3.24%
Above 70%LVR and up to 80%LVR, P&I - 3.34%
Above 80%LVR, P&I - 3.54%
(O/O P&I Fixed Rates from 3.19% for 1-3 years, 3.39% for 4-5 years)
Up to 70%LVR, I/O - 3.74%
Above 70%LVR and up to 80%LVR, I/O - 4.04%
(O/O I/O Fixed Rates from 3.59% for 1-3 years, 3.69% for 4-5 years)Also, if you are specifically looking at investment P&I, then it's 3.79% at ING, 3.60% at Advantage (but no offset, just redraw) and 3.93% at Bankwest.
No harm giving a mortgage broker a call since mos don't charge anyway and they'll "fight" for you and do the "shopping"/research for you.
Hope this helps! Good luck!
are they come with offset account/facility?
Hi zcooler!
Are you referring to the Macquarie loan? If yes, then yes, they come with offset accounts/facility :)
What did your mortgage broker say?