How to borrow 100 percent, 95 percent and 90 percent for an investment property?

There are 2 ways to get the loan approved at 100 per cent:

  • Guaranteed security: If your parents are happy to be guarantors for you and also willing to use their home as a guarantee security, you can borrow up to 100 per cent of the investment property
  • Using equity of your own property: If you already had a property and are looking to purchase an investment property, you can borrow up to 105 per cent by using the equity from your existing home.
Otherwise, you can only borrow up to 95 per cent.

95 per cent & 90 per cent investment loan:

  • If you are in a strong financial situation and good credit history, you can borrow up to 95 per cent plus lender mortgage insurance. To the banks, this type of loan is considered to be higher risk so they normally require both principal and interest repayments to be made.
  • To the banks, borrowing at 90 per cent is considered to be lower risk than 95 per cent. Therefore, you can choose to make principal and interest repayments or interest only repayments.
  • Some mortgage insurers do not allow you to borrow 95 per cent plus LMI. Instead, they will consider 95 per cent including LMI. However, not all mortgage insurers will lend the same. There are some mortgage insurers that have agreements with the banks to lend up to 97 per cent including LMI or 95 per cent plus the full LMI premium

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