Purchasing an investment property for low income earners
Roger was talking to his colleague-friend, Jane, about the idea of investing, what are the good options, where do good returns lay and so on.
Roger suggested Jane, “Why don’t you invest in a property? You should consider it given your interest in buying a home.”
At this Jane replied, “Investing in a property is for millionaires. It is not something I can afford. Look at my income, Roger!!”
This is where Jane lacks in knowledge and expertise. Of course without knowing what exactly investing in a property is like she should not take a plunge. But, she is wrong when she assumes that because she is not a high income earner, she cannot get an investment property.
Many people across Australia live under this misconception. Even if you have an average income you can buy a property. All you need is a careful planning and an expert advice, both of which you can get from a home loan broker. Here are some tips you can consider to turn your dream into a reality.
Zero in on a friendly loan options
It is evident that you will have to opt for loan. Initially, you will take time to gather the deposit and a loan can come in handy here. Some of the lenders might demand a higher deposit but fret not; you can find a friendly loan for your purpose. A good idea is to consider making it your home first and then may be converting it into an investment property. Once you have better financial status, it would all be fine. An expert will suggest you to have at least 10% of the property’s buying price ready with you for the deposit. This will increase the chances of your home loan being approved.
Demonstrate that you are a low risk borrower
Now the question that might arise in your mind is with such low income how do you exactly demonstrate that you are a low risk borrower. Prove that you have a good savings which will depict that you are good at managing your money. This will give you an advantage of making the lender believe in your borrowing capacity.
If you have credit cards, keep the limits as low as possible. Try to prove your stability by clearing off any other loans that you have let say of may be your car or any personal loan. It will increase your credibility.
Be smart with your investment
Being a low income earner, you have slightly more criteria to cater to and so while selecting an investment property you need to be tactical. For the starters, stay away from anything that can induce negative results. Whether you are looking for a long-term investment or a short-term, your property’s location will differ accordingly. Therefore, research the areas properly and keep the profits at the forefront.
See, it is not that difficult!! If you are thinking like Jane, then let go of your fears. Talk to our Mortgage brokers in Burwood, Melbourne and get clarity on the pros and cons. Opulent Finance’s home loan brokers have a good track record of assisting people of varied income bracket make the right decision and those clients are enjoying the fruits of their decisions. Let’s work out your dreams. We are just a call away.