FinanceComparison.com.au

A Users Guide To Investor Finance

Investment Articles > Article: A Users Guide To Investor Finance

Investing to make money may mean borrowing money to make it happen. Investor finance is one of the less known elements of the industry; yet, many investors do borrow money to invest with. There are various aspects of doing this, some good and some bad, each needing careful consideration. Before you leverage a credit card to open a forex trading account, you may want to consider just how well you are spending that money.

Borrowing To Invest

For those who are considering the act of borrowing to invest, there are various elements to become aware of in order to accomplishing this. First of all, you'll need to make a profit, which you will not do unless the funds are available to you for a lower interest rate than the growth of your investment capital. For example, if you borrow off a credit card to open an account so you can invest, and your credit card offers interest rates at 15 percent, you'll have to make at least that back in the type of investing you are doing to see a profit; otherwise, you are spending money without generating a profit.

Whenever you consider borrowing money to invest, look for low interest ways to borrow. But, don't overlook some of the opportunities available to you.

Are you planning to purchase investment property in addition to your current primary place of residence? Many people find this to be one of the best ways to invest their money. Mortgage rates are relatively low and you can often be qualified to purchase a second piece of property through specialized loans. This includes a variety of multi property loans that give you special financing opportunities.

 

If you are considering borrowing to start a business, dabble in the stock market, and other markets, you may want to consider a low interest loan. Some finance companies specialize in loans that are used for investment purposes. These are often not collateral based, but having collateral can help reduce the interest rates even further. That's a great way to have funds available to make investments.

In the same style, you may also want to consider a line of credit. These can be used as other personal loans, but are a line of credit that is only drawn on when you need to. That way, you are not paying for a large amount of money all at one time. Rather, you are saving money by only pulling out what you need for an investment and replacing that over time.

Look toward equity; many people have equity in their homes to use toward investing in the markets. This is another example of a way to draw money that offers a low interest rate that avoids the high cost of a credit card. Equity does put a lot of risk on your home, though, which could be troubling if you find yourself unable to make these payments on time or at all. You could lose your home if you are not wise with your investment choices.

These are just a few options you have available to you. There are likely many other ways you can borrow as well, including looking into your own savings accounts and investment accounts. Additionally, you'll find options like deposit bonds and interest only loans, available to those that qualify.

Getting These Loans

To obtain this type of loan, you'll need to outline your financial goals and develop an investment strategy that you can show to the lender you'll borrow from.

Next, determine the best way to borrow:

  • Line of credit from equity
  • Interest only loans
  • Introductory rate or honeymoon loans
  • All in one accounts
  • 100 % offset account
  • Construction loans
  • Bridging loans

There are many types of loans you could qualify for, depending on the type of investment you are making. In investor finance, you'll need to carefully consider each choice.

Finally, you'll need to find the right lender. Lenders are more than willing to talk about investor finance options with you. Look for the lender that can provide you with the most flexibility and opportunity for financial gain. The good news is that you'll profit from the right lender and they will as well.

Return to Top

 

Credit Cards

Credit Cards

Compare credit cards to find low interest rates, low fees and great rewards on offer in Australia.

Personal Loans

Personal Loans

Compare a range of personal loans. Compare rates, terms, lenders and save!

Bank Accounts

Bank Accounts

Banks are offering great deals on term deposits and high interest online savings account, which one will give you a better deal?

Home Loans

Home Loans

We compare a range of home loans with low rates and great features. Get a free home loan quote today.