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Tips For Obtaining the Best Mortgage Rates

12/05/2022

Mortgage rates have been on the rise lately, so if you’re in the market for a new home, getting the best mortgage rate is more important than ever. You may be tempted to just go with the first offer, but if you take the time to shop around, you could save yourself hundreds of dollars a year. 

Still trying to figure out where to start? Here, you will learn some tips for finding the best mortgage rate. With these tips in mind, you’re sure to find one that fits your needs and saves you money in the long run.

What Is a Mortgage Rate?

A mortgage rate is an interest charged on investment property home loans used to purchase a property. Property investing is a popular way to grow one’s wealth, as it can provide a steadier income stream than other more volatile investments. A low mortgage rate can help to make properties more affordable and increase the return on investment, as more of the monthly payment goes towards paying down the principal of the loan. 

In addition, a low mortgage rate can help to reduce the amount of interest paid over the life of the investment property home loans. As a result, shopping around for the best mortgage rate when considering a property purchase is important.

Types of Mortgages

When it comes to property investing, there are several different mortgage options available in Australia. The type of loan that you choose will depend on your circumstances and investment goals. 

  • Interest-only Loan

Consider an interest-only loan if you’re looking to buy an investment property with a low deposit. These loans offer the benefit of lower repayments during the initial investment period, giving you more flexibility regarding cash flow. However, it’s important to note that interest-only loans typically have higher interest rates than principal and interest loans. 

  • Fixed Rate Mortgage

A fixed-rate loan may be a better option if you’re looking for a longer-term investment. These loans offer stability by fixing the interest rate for a set period, usually 1–5 years. This can help to protect you from market fluctuations and gives you the peace of mind of knowing exactly what your repayments will be each month. 

  • Variable Rate Mortgage

A variable-rate mortgage is a home loan where the interest rate can change over time. This can be either up or down, depending on market conditions. The main advantage of a variable-rate mortgage is that your repayments can go down if interest rates fall. 

  • Investment Home Loans

If you’re considering investing in property, investment property home loans are a great option. These loans typically offer lower interest rates than standard home loans, making it easier to grow your rental income. However, it’s important to remember that you’ll still be responsible for making all the monthly repayments, even if your property isn’t generating any rental income.

When choosing a mortgage for your investment property, make sure to compare your options and select the investment property home loan that best suits your needs.

What to Consider When Choosing a Mortgage Rate

In property investing, you need to consider a few things in choosing a mortgage rate:

  1. The property you are purchasing. Is it an investment property or your home? Investment property home loans typically have higher interest rates than owner-occupied ones, so it’s important to factor this into your decision. Other considerations include the type of property you’re buying (e.g. house, unit, townhouse) and the property’s location.
  1. How long do you plan to hold onto the property. If you’re planning on selling it within a few years, you might be better off choosing a variable-rate mortgage to take advantage of any interest rate drops. However, if you’re planning on holding the property for the long term, a fixed-rate mortgage might be a better option as it will give you certainty about your repayments for the life of the loan. 

Ultimately, there’s no right or wrong answer when choosing a mortgage rate—it all depends on your circumstances. Talk to a financial advisor or mortgage broker to get expert advice on what would work best for you.

How Much Can You Save By Getting a Lower Interest Rate?

Even a tiny difference in the interest rate can significantly affect the overall cost of the loan. Over the life of the investment property home loan, that can amount to thousands of dollars in savings.

For example, let’s say you take out a $500,000 loan with an interest rate of 5%. For 30 years, you would end up paying $593,000 in interest. 

But if you could get a 1% lower interest rate, your total interest payments would drop to $479,000—savings of over $113,000. If you’re investing in multiple properties, those savings can add up.

Tips for Obtaining the Best Mortgage Rates for Your Needs

Here are some tips to help you get the best mortgage rates for your needs: 

● Shop Around

There are many lenders out there that offer investment property home loans. Shopping around and comparing rates before deciding on a lender is important. 

● Consider Your Financial Situation

Be sure to have a clear idea of your income, debts and expenses to make an informed decision about whether or not an investment property home loan is right for you. 

● Know Your Goals

It is also important to have a clear idea of your goals for the property before applying for an investment property home loan. Are you looking to generate a rental income? Are you hoping to sell the property for a profit? 

● Get Pre-approved

Once you have considered all of these factors, it is time to get pre-approved for an investment property home loan. This will give you a better idea of what interest rates and terms you qualify for. 

● Compare Interest Rates and Terms

It’s time to compare interest rates and terms from different lenders. Be sure to compare apples to apples so you can make an informed decision about which lender offers the best deal. 

● Lock in a Rate

Lock in your rate will protect you from rising interest rates and help ensure you get the best deal on your investment property home loan.

Start Your Property Investment Journey with Investorfi

Imagine what you could do with extra money in your pocket each month. You could put it towards a new car, take a vacation or save it for a rainy day. Whatever your goal, getting the best mortgage rate will help make it happen.

Investorfi has all the tips and advice you need to get started. We’ll help you every step of the way, so you can rest assured that you’re getting the best deal possible on your mortgage. We have access to some of the lowest mortgage rates and can help you secure a loan that fits your unique needs. 

Whether you’re a first-time homebuyer or are looking to refinance your current loan, our team is here to help. 

Contact us today and see how much money you could save by working with Investorfi.

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This is what we do.

We are finance strategists in the Mortgage Broking industry, helping Australians build wealth through property investment.

Our sole purpose is to reinvent ways to keep the Great Australian Dream Alive. Because we believe it’s everyone’s right to the security home ownership affords our families and community. Yes, our niche is Finance Strategy for Property Investors, but it is not what we do that makes us tick;
it’s

Because property investment is a decisive step toward financial freedom, we cultivate lasting relationships with our clients. We ain’t just a ‘whame bam, see ya later man’ kinda outfit. In fact, our business is built entirely from our lasting relationships with our clients who have suggested us to their inner circle – their family and friends. That is a pretty big tick of approval and a sure vote of confidence.

This is How we do

What separates us from the rest?

Have you ever considered the difference between Mortgage Brokers?

A Broker worth their salt has a playbook of ‘scenarios’. They are finance strategies that have worked in the past. He will offer up one, two or even three scenarios that he thinks will work best for you. 

But the great ones challenge the status quo, strategising new plays that serve your unique situation and financial goals. They will study, visualise, and fine-tune before offering only the best scenarios that build a rewarding property Portfolio.  

They never let good be the robber of the best and only play to win!

InvestorFi is a group of finance strategists that will design a unique scenario for your state of play towards your long-term game plan.

But don’t just take my word for it.

Clients like Tony F. said: I couldn’t be happier with the service. Wayne was excellent in guiding me through and delivering a great investment loan. Very responsive and savvy investment brokers. Will continue to use their services in the next purchase. 

And like Kim, Wayne is extremely dedicated, professional and a pleasure to work with. He worked tirelessly to help me secure an alternate lender before the settlement date and was extremely prompt and clear in his communications with me. 

And 

Robert wrote: Wayne is always very responsive and takes the time to lay out all the options in plain English.

Reviews like this make our souls sing. We’re in the business of helping people achieve real results that last!

So if you’re looking for a great Finance strategist like these incredible clients, you’re in the right place.

This is why we do

Gone are the days a single income could afford 2.5 kids, a pet, and a four-bedroom house in the burbs! 

At InvestorFi, our sole purpose is to reinvent the great ‘Australian Dream’. Because we believe it’s every citizen’s right to the security home ownership affords our families and community, not just for today but for generations to come.

But because it’s become so difficult, it requires complex solutions. One way is to seek finance strategy before purchasing a home. This way, you can leverage your full potential to live where you want to and invest where you can afford to. 

Property ownership has become a game of ‘finance strategy’, placing a premium on finance know-how. That is why we value education; our mantra is knowledge equals freedom, but knowledge shared is freedom multiplied.  

There is no drought; we have hit a new era with its epic challenges. Not everyone is up for the grind it takes to keep the dream alive. That’s why we also place a premium on camaraderie. We don’t see ourselves as a ‘hit and run’ service but as a hub and a way of life.