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Investment Loans

Are you an investor looking to grow your property portfolio? Then land yourself a standout home loan deal, with a low interest rate and great features to boot, by kicking off your mortgage comparison in the table below.

Investment home loan comparisons on Mozo - last updated 4 March 2021

Search promoted home loans below or do a full Mozo database search. Advertiser disclosure.
  • Smart Booster Investor Bundle Home Loan

    1 Year Discounted Variable Rate, Interest Only

    variable rate
    comparison rate
    Initial monthly repayment
    1.99% p.a.variable for 12 months and then 2.74% p.a.
    2.71% p.a.

    A super low introductory rate home loan with no monthly or ongoing fees. Unlimited free redraws and unlimited additional repayments to help you build your equity and own your home sooner. Multiple loan splits available. (Rates revert after introductory period ends).

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  • Mozo Experts Choice 2020
    Celebrate Variable Home Loan

    <60% LVR, Investment, Principal & Interest

    variable rate
    comparison rate
    Initial monthly repayment
    2.54% p.a.
    2.54% p.a.

    Enjoy zero fees and a speedy online application process. Free extra repayments and redraw facility. Flexible loan repayments. Minimum 20% deposit required. Crowned Best New Home Loan for 2020 by the Mozo Experts.^

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  • Hot DealAvailable to self-employed borrowers
    Prime Home Loan

    Investment, Principal & Interest, LVR <70%

    variable rate
    comparison rate
    Initial monthly repayment
    2.59% p.a.
    2.64% p.a.

    Find your fit with competitive home loans for borrowers with clear credit and strong employment history. Flexible repayment terms. 20 year home loan history. Get a dedicated loan consultant for the loan application process. 30% deposit required.

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  • Well Balanced

    Investor, Principal & Interest, LVR <80%

    variable rate
    comparison rate
    Initial monthly repayment
    2.36% p.a.
    2.42% p.a.

    Zero ongoing fees and free extra repayments and redraw facility with an option for an offset account.

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  • Mozo Experts Choice 2020
    UHomeLoan

    Investment, Interest Only

    variable rate
    comparison rate
    Initial monthly repayment
    p.a.
    2.64% p.a.

    Lock in a low home loan rate with the 2020 Home Lender Bank of the Year, UBank. UHomeLoan offers competitive rates for a range of fixed terms . Winner of two 2020 Mozo Experts Choice Awards for best Fixed Rate Home Loan and Investor Fixed Home Loan.

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  • Mozo Experts Choice 2020
    Evaporate Variable Home Loan

    60-70% LVR, Investment, Principal & Interest

    variable rate
    comparison rate
    Initial monthly repayment
    2.59% p.a.
    2.56% p.a.

    Zero fees with speedy online application. Free extra repayments and redraw facility. Flexible loan repayments. Min. 20% deposit. Crowned Best New Home Loan for 2020 by the Mozo Experts.^

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  • Mozo Experts Choice 2020
    Smart Home Loan

    Investor, Principal & Interest

    variable rate
    comparison rate
    Initial monthly repayment
    2.74% p.a.
    2.76% p.a.

    A low-rate home loan that could save you thousands. No ongoing fees. Unlimited additional repayments. Unlimited free redraws with no minimum redraw amount, Limited time only.

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  • Mozo Experts Choice 2020
    Liberate Variable Home Loan

    70-80% LVR, Owner Occupier, Principal & Interest

    variable rate
    comparison rate
    Initial monthly repayment
    2.29% p.a.
    2.23% p.a.

    Fast online application with no fees. Free extra repayments and redraw facility. Min 20% deposit. To reward borrowers for paying down their home loan, Athena will now automatically lower the rate as the loan is paid down. Crowned Best New Home Loan for 2020 by the Mozo Experts.

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  • Mozo Experts Choice 2020
    Fixed UHomeLoan

    Investment, Principal & Interest

    variable rate
    comparison rate
    Initial monthly repayment
    p.a.
    2.60% p.a.

    Lock in a great low home with UBank - 2020 Home Lender of the Year. Fast and easy online application. No monthly account fees. Winner of two 2020 Mozo Experts Choice Awards for best Fixed Rate Home Loan and Investor Fixed Home Loan.^

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  • Well Balanced

    Investor, Principal & Interest, LVR <90%

    variable rate
    comparison rate
    Initial monthly repayment
    2.87% p.a.
    2.90% p.a.

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^See information about the Mozo Experts Choice Home loans Awards

*WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for $150,000 over 25 years.

Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.

While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.

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About investment property loans

Who can resist the allure of the buzzing property market? Your property is likely to appreciate in value, plus if you get a tenant in the rent could cover your ongoing repayments and other associated property costs.

Even if your property is negatively geared, when it comes to tax time you can deduct the amount you’ve lost on your property to bring down your taxable income. Sounds awesome right?

While investing in property has its many perks, there are some things you’ll need to keep in mind when looking for investment home loans to ensure you pick the right loan for you.

The first thing you should think about is your...

What is Loan to value ratio (LVR)?

The Australian Prudential Regulation Authority has been putting pressure on banks to reduce their investment loans book to under a 10% growth per annum.

As a result major banks are beginning to put caps on the amount that investors can borrow and are generally implementing new eligibility which requires investors to have a loan to value ratio of 80% or less.

If more lenders in Australia follow suit and you’re a first timer wanting to purchase your first investment property you will either need to wait until you have saved up a 20% deposit (e.g 80% LVR) or ask your parents to be your home loan guarantor, which means they will put up a portion of their own home as security for your investment loan to help you get approved.

Another thing to keep in mind is big banks have also increased their stress tests, which means when they assess you for an investment property loan they will see if you can comfortably service the loan at a higher interest rate. For instance, if their standard variable interest rate is 5%, they may use a 7.5% scenario to see if your income could easily manage a rate rise in the future. Get an idea of how much you could afford to repay if rates were to climb, by using our rate change calculator.

How can I choose the right investment home loan?

Once you know you fulfill the requirements when it comes to the amount you’re looking to borrow, it’s time to think about the type of investment property loan you’ll sign up with. One of the more popular options is choosing an interest only home loan. Read on for a full definition:

Interest only home loans

As the name suggests, unlike a standard home loan where you repay both the principal and the interest, with an interest only investment loan you’ll only repay the interest. This means that your ongoing repayments will be significantly lower.

Check out this scenario: Sarah wants to borrow a total of $500,000 paid back over 25 years. Our home loan repayments calculator shows with a 5% interest rate, if she chose the principal and interest repayment option her monthly repayments would be $2,923. But if she opted for the interest only option for the first 5 years, during this period her ongoing payments would be brought down to $2,083.

Another reason interest only home loans are a popular option for investors is because of a little something called negative gearing, which means if the cost of repayments and looking after the property is more than your returns in rent, you can claim the home loan interest and property maintenance come tax time and potentially get a partial to substantial refund on that amount.

While the interest only period won’t last forever (generally for 5 years) and you’ll eventually have to start paying off both the interest and principal, you could negotiate at the end of the interest only period to have it extended for another 3-5 years.

But keep in mind, interest only home loans aren’t for everyone. The whole point of an interest only loan is you’re relying on your property’s value to increase over time. This can be risky if you’re buying in an area that could see a drop in property prices down the track, so in this instance you may be better off paying down both the principal and interest.

Variable, fixed or split interest rate?

Whether you choose an interest only investment loan or the standard principal and interest repayments, you’ll be able to choose the type of interest rate to suit you.

  • Variable interest rate: The more popular option in Australia is the variable rate option, which changes according to the economy. The reason many investors opt for variable rate home loans is because they generally come with greater flexibility than fixed rate loans like an 100% offset account (see below for a full definition), which allows you to bring down the amount of interest you pay.
  • Fixed interest rate: By comparison, a fixed interest rate will mean your rate is locked in for the fixed rate period. While more and more providers are introducing fixed rate loans with an extra repayments facility (with a cap of around $10,000 per annum), fixed rate loans generally don’t come with an offset account.
  • Split interest rate: You could also consider splitting your investment loan, which means a portion will be variable allowing you to enjoy the benefits of an offset account on the variable amount and the remainder will be fixed giving you some security if your lender lifts rates.

Are offset accounts important for investment loans?

Yes, once you’re signed up with an investment property loan, it’s a smart move to get your salary deposited into an offset account linked to your mortgage, rather than a bank account because you’ll reduce the amount of interest you pay.

Let’s go back to our scenario of investor Sarah. Once she is approved for her $500,000 investment home loan, if Sarah puts $30,000 worth of savings into a linked offset account, this will mean instead of being charged interest on the full $500,000, she would only accrue interest on $470,000. Once Sarah has saved up enough in her offset account, she can easily access the money to use it as her deposit for her next investment property, thus growing her investment portfolio.

What fees will I pay on an investment loan?

Just like any other home loan, there are some fees to watch out for when taking out an investment home loan. Here are the common charges:

Upfront fee: When you apply for an investment loan, the bank will have to run a credit check on you to see if you are a risky borrower. To cover this cost and any administration costs involved in assessing you for the investment property loan you may be charged a one off upfront fee anywhere between $0-$800.

Ongoing service fees: There may also be a small ongoing fee of around $10 that the lender charges for providing you with the loan.

Breakcost fees: Banned on variable rate loans back in 2011, breakcost fees can still be charged if you try to pay out a fixed rate loan early.

What documents will I need to apply for an investment home loan?

Each bank or financial lender will ask for different documentation when you apply for one of their investment loans, however generally they will require:

  • Identification: The provider will want to know who you are by obtaining a certified copy of documents like your passport, Australian driver’s licence, birth certificate, medicare and utility bills.
  • Income: They will want to determine whether you can comfortably service the investment home loan by seeing your latest PAYG Payment Summary from your employer, as well as your contract outlining your salary and a letter from your employer confirming the length of time you’ve held a position at the company.
  • Existing loans: If you have a credit card or personal loan you’re paying off, then the lender will usually ask for around 1-3 months worth of statements.
  • Genuine savings: You’ll also be asked to provide around 3 months worth of bank and savings account statements, so that they can see you are a diligent saver.

What are low doc home loans?

Often it can be hard for small business owners and sole traders to come up with the necessary paperwork like payslips or a letter from your employer for investment loans. So if you’re self employed or work under an ABN, you may need to apply for a home loan with more flexibility when it comes to documentation.

The solution is applying for a low doc home loan that allows you to have less documentation. But there’s a catch, usually the interest rate will be higher and you’ll also need to have a lower loan to value ratio of 60% (e.g 40% or more deposit).

Ready to kick off your investment property loans comparison? Scroll up to the top of this page to compare home loans in our investor table or punch in your numbers into our home loan comparison calculator to search our entire database.

Home Loan Reviews

People's Choice Credit Union Variable Home Loan (Package) review
Overall 9/10
Friendly staff reasonable rates charges & features

People's Choice have a good range of home loans at reasonable rates. If you take out a home loan package there are no fees other than an annual fee - all refinancing, redraws, etc. are at no additional cost. They offer unlimited redraw facilities and the best thing I like is you can have as many offset accounts as you want - I currently have six for different purposes which makes saving up for different things easier. The staff are friendly and genuinely want to help you achieve your financial goals.

Read full review

People's Choice have a good range of home loans at reasonable rates. If you take out a home loan package there are no fees other than an annual fee - all refinancing, redraws, etc. are at no additional cost. They offer unlimited redraw facilities and the best thing I like is you can have as many offset accounts as you want - I currently have six for different purposes which makes saving up for different things easier. The staff are friendly and genuinely want to help you achieve your financial goals.

Price
7/10
Features
9/10
Customer service
10/10
Convenience
8/10
Trust
9/10
Less
Malcolm, South Australia, reviewed 1 day ago
Commonwealth Bank Standard Variable Rate review
Overall 5/10
Not a lot of trust for banks.

Pricing is not competitive as other banks have much lower rates for the same kind of loan. Features have a redraw facility but that's it. I have never heard from the bank in 17 years after receiving the loan - I do hear from my mortgage broker - who sends me a scratchie ticket every year for Christmas. Imagine getting that from your bank - don't think so! The bank only thanks you for being a loyal customer if you walk in there and ask for service. Convenience is great through online banking, but they do not want you in the bank as they make that clear by having one teller on at lunch - very uninviting. Trust - Have they really earned the trust of the people? I would not recommend any bank to anyone unless the bank bent over backwards to give amazing services and to also keep contact with their customers.

Read full review

Pricing is not competitive as other banks have much lower rates for the same kind of loan. Features have a redraw facility but that's it. I have never heard from the bank in 17 years after receiving the loan - I do hear from my mortgage broker - who sends me a scratchie ticket every year for Christmas. Imagine getting that from your bank - don't think so! The bank only thanks you for being a loyal customer if you walk in there and ask for service. Convenience is great through online banking, but they do not want you in the bank as they make that clear by having one teller on at lunch - very uninviting. Trust - Have they really earned the trust of the people? I would not recommend any bank to anyone unless the bank bent over backwards to give amazing services and to also keep contact with their customers.

Price
5/10
Features
5/10
Customer service
1/10
Convenience
5/10
Trust
3/10
Less
Karen, Queensland, reviewed 3 days ago
NAB Home Loan review
Overall 1/10
Not happy.

We had our home loan with NAB. We were looking at refinancing to get a better interest rate and a little more money to do renos on the house. Was told no straight away, even though we have been paying more money onto the loan and have never been behind in payments. They didn't even have a look to see if we could or couldn't do it. Also we didn't change anything throughout COVID-19, still paid the some every fortnight. We have been with NAB for over 10 years and no help, the customer service was so bad I have made a complaint. We have gone with another company and NAB bank made the settlement go on for over month. They kept on saying we need more time with all the paperwork, which they had in time of the settlement. Both myself and the other bank put it down to they want the monthly interest rate that they were going to miss out on.

Read full review

We had our home loan with NAB. We were looking at refinancing to get a better interest rate and a little more money to do renos on the house. Was told no straight away, even though we have been paying more money onto the loan and have never been behind in payments. They didn't even have a look to see if we could or couldn't do it. Also we didn't change anything throughout COVID-19, still paid the some every fortnight. We have been with NAB for over 10 years and no help, the customer service was so bad I have made a complaint. We have gone with another company and NAB bank made the settlement go on for over month. They kept on saying we need more time with all the paperwork, which they had in time of the settlement. Both myself and the other bank put it down to they want the monthly interest rate that they were going to miss out on.

Price
2/10
Features
2/10
Customer service
1/10
Convenience
1/10
Trust
1/10
Less
Sonia, Queensland, reviewed 3 days ago
See
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