Investment Home Loans

Yes. If your owner-occupier home has equity (the difference between its value and what you owe), you can use that equity as the deposit and avoid selling assets or draining savings. The lender treats both properties as security—one loan against your home, one against the investment property, or a single loan with both on the title (called cross-collateral). Most lenders will lend up to 80–90% combined LVR across both properties. Andy calculates how much equity is available and whether you’ll need LMI before you start looking.

Not always. Some lenders will go to 90% LVR (10% deposit) or even 95% LVR if you have strong serviceability and stable employment, but you’ll pay lenders mortgage insurance above 80% LVR. If you’re using equity from your home, the combined LVR across both properties usually caps at 85–90%, which means the effective deposit depends on how much equity you have, not how much cash you’ve saved. Andy works out the realistic LVR for your scenario in the pre-approval stage.

Yes—every dollar of interest you pay on a loan used to purchase, build, or renovate an income-producing property is deductible against your rental income (and other taxable income if the property is negatively geared). This includes the loan establishment fee, monthly account-keeping fees, and lenders mortgage insurance if it’s paid upfront. It does not include principal repayments, building insurance (that’s a separate deduction), or any portion of the loan used for private purposes. Keep every loan statement; your accountant will claim the deduction at tax time.

Variable gives you flexibility—you can make extra repayments, refinance without break costs, or switch to interest-only mid-term if your circumstances change. Fixed locks your rate for 1–5 years, which protects you if rates rise but traps you with break costs if you sell, refinance, or rates fall. For investment loans, most Perth buyers either go full variable or split 50/50 (half fixed, half variable) so they have rate protection and flexibility. Andy’s default recommendation: if you’re planning to hold the property for 10+ years and your cash flow can handle a 1.5% rate rise, variable is usually cheaper long-term. If you need repayment certainty for the next 2–3 years, fix that portion.

Yes. Lenders want two years of tax returns (both personal and business if you run a company or trust), plus your most recent BAS or financials. They assess your income as the average of the last two years, sometimes adding back depreciation and one-off expenses your accountant has written off. Serviceability is tighter than for PAYG employees because lenders see self-employed income as less stable, but it’s not a barrier—Andy arranges investment loans for self-employed borrowers in Perth every month. The key is clean tax returns that show consistent declared income; if you’ve minimised your taxable income too aggressively, borrowing power drops.

Negative gearing means your rental income is less than your loan interest plus other holding costs (rates, insurance, strata, maintenance), so you’re making a loss on paper. That loss is deductible, which lowers your taxable income. You’re betting on capital growth to make up the shortfall when you sell. Positive gearing means your rental income exceeds your costs, so the property makes a profit each year. That profit is taxable, but you’re not subsidising the property out of your salary. In Perth and Mandurah right now, most houses are negatively geared (yields 4–5%); regional WA and some older units can be positively geared if you buy below $400,000. Negative vs positive gearing explained covers the tax mechanics in detail.

Pre-approval: 3–5 business days once you’ve supplied income documents and ID. Full approval after you’ve signed a contract: 10–20 business days depending on how fast the valuation comes back and whether the lender queries anything in the rental appraisal. SMSF loans and trust loans take longer (15–30 business days) because the lender’s credit team has to review the trust deed and SMSF compliance. Andy lodges applications the same day you sign off on the structure, so there’s no time lost*.

Not for loan approval—lenders only require building insurance (and strata insurance covers that for units). But landlord insurance (which covers loss of rent, tenant damage, and legal costs if you have to evict) is worth the $300–600/year for most investors. If your tenant stops paying and it takes 8 weeks to get them out, you’re losing $4,000–6,000 in rent; landlord insurance reimburses that. It’s not compulsory, but Andy recommends it for every investment property.

Yes, and it’s common among younger Perth buyers who can’t afford a house in the suburbs they want to live in but can afford an investment property in Mandurah, Rockingham, or regional WA. The downside: when you later apply for an owner-occupier loan, the lender will assess your serviceability including the investment loan (even though rental income offsets most of it), which reduces how much you can borrow for your home. The upside: you’re building equity in property now, and the investment loan interest is tax-deductible. Andy runs the numbers both ways so you know whether buying investment-first will limit your owner-occupier borrowing power later.

Lenders mortgage insurance (LMI) is a one-off fee the lender charges when you borrow above 80% LVR; it insures the lender (not you) against loss if you default. On an investment loan, LMI kicks in at 80% LVR for most lenders, or at 85–90% combined LVR if you’re using home equity as security. To avoid LMI, you need a 20% deposit (or 20% equity across all securities). The cost ranges from $2,000 to $15,000+ depending on loan size and LVR; you can pay it upfront or capitalise it into the loan. It’s tax-deductible, but it’s still a cost you’d rather avoid.

Lenders assess your income, existing debts, living expenses, and the rental income from the investment property (at 80% of market rent). A rough guide: if you earn $100,000/year with no other debts and the property will rent for $500/week, you can typically borrow $500,000–600,000 at current rates (6.5–7%). If you have an existing mortgage or car loan, that borrowing power drops. Andy runs a full serviceability calculation in the first call so you know the realistic budget before you start looking. How much can I borrow for an investment property has worked examples for different income/debt scenarios.