I need a car to be able to get the kids to school and get a new job. I've just divorced my husband, and while I get some money each week, it's hard to save enough for a car out of that. I need to get a used car and a car loan to get us on our feet and start our new life. I don't really mind what a car looks like as long as it runs well. This blog is about getting loans for getting on with the rest of your life after a divorce and has tips for newly single mums.
When considering property investment, most individuals tend to focus more on the property itself. They fail to understand that the success of any investment property depends not only on picking the ideal property but also on choosing the right investment loan. Getting the correct type of financing is an essential step before purchasing an investment property.
So, how do you find and choose the right investment loan? Well, here are five practical tips to help you make an informed financial decision:
Be Sure To Research Thoroughly
The terminologies enveloping financial loans can be pretty intricate and confusing. If you are relatively new to financial loans, it would be wise of you to pause for a moment before applying for anything. Take time to understand property-related concepts like depreciation, negative gearing and equity. Knowing these things will be pivotal in determining your final decision.
Have a Solid Investment Strategy
After conducting your research and getting acquainted with relevant financial jargon, you need a strategic plan. This strategy will be paramount in defining the investment loan you'll end up choosing. Some investors adopt the "buy and hold" strategy if they are in for the long haul. Others will consider buying the property and paying it off over time whilst collecting rent.
Also, there are those optimistic investors who're sure that their property will undergo appreciation faster. As such, they opt to choose a different strategy. If you already own a property outright, you can easily use its equity to purchase your investment property.
Strategise Your Repayment Type
The investment strategy you set in place will determine whether to go for a principal and interest (PI) loan or an interest-only loan. For instance, if you are confident that the value of the property you want to buy will increase, consider making small interest-only repayments. This approach reduces your costs before selling the property – hopefully, substantial profit. If you're a cautious investor paying off your investment in full while collecting rent, a PI loan will be cheaper over time.
Choose the Best Interest Rate
Generally, lower interest rates will attract lower repayments on the investment loan. Furthermore, choose whether a variable or fixed interest rate would be ideal for you. While variable rates are susceptible to falling and rising, fixed rates offer a window of certitude, providing you with a clue of how much repayments you'll be making.
Get the Loan With the Required Features
Finally, scrutinise your loan's features, but the most common ones are offset accounts, synonymous with investment loans. They're simply bank accounts linked to home loans, and any money inside them is temporarily offset against the loans' principal.
Share15 December 2021
