Buying investment with low savings but 180k equity?

Discussion in 'Loans & Mortgage Brokers' started by Savannah-1988, 5th Jul, 2020.

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  1. Savannah-1988

    Savannah-1988 New Member

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    5th Jul, 2020
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    Hi all, we are looking to get an Investment property in a year or so for a retired family member to rent out who doesn’t own a home. I’m wanting to know if we can get a loan using our 180K equity as we have minimal savings, we have 333k left on our morgage and the new property will be around 290K as we live in an affordable area, we will of course go to the bank to discuss and try save in the meantime but wanted to know anyone else’s experience?
     
  2. DaveC

    DaveC Member

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    It might just be my perspective but this sounds a bit like train wreck waiting to happen, but depending on your saving particulars you should be able to borrow against your house.

    That said, i think it’s important to define the relationship and arrangement legally if it’s an investment rather than charity.
     
  3. Spiralkut

    Spiralkut Well-Known Member

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    Yes you can use your equity as deposit.
     
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  4. Savannah-1988

    Savannah-1988 New Member

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    It’s for my elderly father, so I don’t see how it could be train wreck, the only other option for him is to live in commission housing which can take years to get, i know his pension Centrelink income and rental payment capability as he is currently renting at the moment. Thanks
     
  5. DaveC

    DaveC Member

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    Just be sure you can cover the expenses with a good safety margin.
     
  6. Lindsay_W

    Lindsay_W Well-Known Member

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    It actually has nothing to do with your savings/ability to save.
    People use equity for deposit + costs when purchasing another property all the time, so yes it's possible BUT the answer comes down to serviceability, can you afford to borrow the equity plus new loan for the investment property.
    Depending on which bank you speak to you might not be able to, if you want the best chance you should see a mortgage broker as they have access to lots of lenders.
     
    Last edited: 5th Jul, 2020

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