Investment property is real estate bought for investment purposes as opposed to private residential. Often the property will be used for rental purposes, such as rental home, apartments or other spaces that give owners the opportunity to create profit and income over the long term.
Interest rates that you pay on investment property loans are similar to the rates for normal loans, and often have the same features, like the choice between a variable or fixed interest rate. Usually those borrowing for investment property are considered to have a lower risk quotient, and could avail of discounts.
Some may wonder if such discounts really exist. Yes, they do. Most providers have some great offers to help borrowers benefit from a lower interest rate, and thus, save money. Take a look at some such offers:
o Honeymoon rates. Offered in the introductory period, these interest rate discounts are offered by many providers during the first year of the loan. Some may argue that this is a timed discount, but this offer helps save a lot of money in the first one year itself.
o Discounted interest rates for low risk. Almost all providers consider borrowers of investment property loans to be low-risk. They normally have an existing income stream, with more expected to come from their investment property. And most likely, they own homes that act as perfect collateral.
o Discounted interest rates for larger loans. Borrow a larger sum of money and enjoy lower rates and other benefits. That’s what providers seem to say when they offer different rates for different slabs.
Here are two tips to help you get a lowest interest on your loan:
o Use of Loan Calculators: Home loan calculators require all the loan details, so that they can give you a list of tailor-made loan options that fit your requirements. Borrowers secure the lowest interest rates. But never underestimate the importance of a real life loan consultant, who can help you complete your calculations.
o Comparing providers. Always compare the offers that different loan providers make in order to find one that is perfect for you. It’s a tedious process, made easy and quick with the Home Loan Finder.