Investment Property Loans

Many investment property loans are not always the best way to proceed.

A mortgage on property is better and the rates can be quite expensive when compared to an interest only mortgage.

It should be remembered that any loan repayments will include the capital as well as the interest. So when comparing this against an interest only mortgage, then a loan becomes inefficient. You'll probably have to put down 25% instead of perhaps 10% and the rates will be higher. It is the 25% that is tied up in the property that makes this an inefficient method to finance the asset.

Of course there may be times when a loan is necessary - for example if you can't get a mortgage just at that time or if you need to co borrow against a property.

However, there is a market for them so they must sell!

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