All You Need to Know About Investing

Investment loans also have comparison rates, and they’re used the same way as other home loan comparison rates: as a tool to more easily compare options from lender to lender. Tiimely Own home comparison rates are calculated for a $150,000 loan over 25 years. They factor in our fees associated with applying for the loan; our ongoing fees and our fees associated with leaving the loan.

Negative gearing is when an investment property costs more to maintain than the rental income it provides, meaning it operates at a loss. This loss is then deducted from your overall taxable income, which may reduce the income tax that you pay.
This is the opposite of positive gearing, which covers circumstances where the rental income made from the property is more than you pay in mortgage interest payments, maintenance bills and other costs.
An accountant can give you the most up to date information directly associated with your particular circumstances.

And you can read more about investment property including tips for researching and purchasing, in our helpful guide.

Equity is a powerful tool that can help you to build a profitable investment property portfolio.

The equity in your home can be used as an investment property deposit and if you have enough equity built up, you can borrow 80% of the property’s value without having to use your own cash.

How equity is calculated

Your accessible equity is the difference between your home’s current value and how much you owe on your home loan.

If you’ve lived in your home for five years or more, you’ve probably accumulated quite a bit of accessible equity.

But lenders will only lend up to 80% of your home’s current value minus your current mortgage. This is known as your useable equity, which is quite a bit less than your accessible equity.

It can still however, be a significant amount for an investment property deposit or any other use you may have such as renovating, investing in shares or managed funds or improving your lifestyle with a holiday or a new car.

Buying an investment property

All investments carry some level of risk, so it’s important to get professional financial advice to fully understand your options.

This depends on many different factors, such as your income and current living expenses and every lender has their own formula for calculating your borrowing power.

You can get an estimate of your borrowing power with Tiimely Home by using our borrowing calculator.

To apply for a Tiimely Own home loan, have a look at our eligibility criteria to see if we could be a good fit. Then, take a look at our home loan options to see if any of our investor home loans suit you. When you’re ready, apply online. Our digital application should take around 15 minutes to submit.

This is not possible. At the time of application, you’ll need to specify whether you’re planning to live in the property or not. If you’re planning to rent it out, you’ll need an investment home loan.
And if you decide to move into your investment property, you’ll need to change your investment home loan into an owner-occupied one.

Home equity is the difference between the market value of your property, and the amount that you still owe on your mortgage.
For example, if your property is worth $650,000 and the amount you have remaining on your mortgage is $400,000, then you’d have $250,000 in equity.

Note: The actual available amount that you can ‘release’ and use to purchase, may not the entire difference amount, so it’s important to confirm with your lender what requirements are needed in order to make an accurate calculation. This may include a formal valuation of your existing property.

Read our guide for more detailed information about home equity; what it means and how it works.

Investments loans are typically higher than owner-occupied loans because they are seen by the lender as carrying more risk. This is especially relevant if you are depending on the rental income you receive in order to cover your loan repayments.
Find out more about our rates - including those for investors.