One of the frustrating changes as an investor over the last few years has been how hard it is to access revolving credit facilities if you don’t have a specific property purchase in mind. Banks have practically made giving away your first born as part of the criteria and with great deals not sitting around for long having access to the ability to move quick is a great asset to have.
For those of you still have facilities in place which are drawn down if you have unutilized equity in other properties (room to borrow between what the property is worth and what the current debt figure is) it is worth considering Select Home Loans mortgage facilities as they are fine if their criteria is met to refinance debt across to them and then pay your existing revolving credit facilities down. Unlike banks who if you go down this path have a standard requirement that you reduce your limit thus meaning you lose the benefit of the facility Select will let you keep your limit meaning you have funds ready to go again.
Another positive is right now Select’s prime interest rates are almost on par with (and in some cases are beating) bank rates. At the time of writing as an example you can get a 2-year rate at 2.99% or a 3-year rate at 3.34% which has the benefit of if you repay an existing revolving credit facility you should be saving on interest costs with almost all bank floating rates being higher than this.
Please note that the above rates are based on 70% LVR – which also allows you to release another 10% equity, or more if you are currently at 60% LVR or lower.
This is a great option which several our investors and traders are using to keep their property transactions moving forward.
If you would like to learn more please contact us at info@krispedersen.co.nz and we can advise further.