Mortgage checklist

Investment Property Checklist

As part of any smart property investment, a good idea is to develop your own Investment Property Checklist. There is a lot to consider when investing in a new property, and it goes without saying that it is likely that you will be dealing in large amounts of money. So why not do yourself a favor, and build your own Investment Property Checklist. I have put together some thoughts below, however, it is important to make a list that suits your goals, and plans. What is key for me, may not be a consideration for you.

1)      Do the sums, and if they don’t work out walk away. Always buy within your means.

2)      Check the property, and inspect for defects, if there is anything that concerns you, pay for a building report. It is better to waste a few hundred now, than to throw away your investment on a leaking building. At the very least you can use any problems with the property to help talk down the price, if you don’t have this information, you may end up over paying.

3)      Get a pre approval from your bank or money lender before you commit to any deposit. This sounds like a no brainer, but bidding on an auction or making a commitment to buy, then finding out you don’t have approval from your bank will cost you.

Mortgage checklist

1)      Loan duration – What is the duration of the loan – make sure you are comparing peas with peas and carrots with carrots when you are looking at different options.

2)      What is the interest rate? Is it competitive? Do some research. Just because someone is willing to give you money, it doesn’t make it the best deal in the world. Compare.

3)      Is the interest rate fixed or floating – If you have a fixed income, then fixing your loan can provide reassurance that you will always be able to afford repayments. Floating my be a better option in times of recession, when interest rates are low and banks won’t commit to a lower long term fixed rate.

4)      Are there any extras included in the package. Typical freebies might include covering lawyer costs, or covering certain insurance costs for a fixed period of time. It is worth knowing all the details of your package.

How to spot Market Crashes

Investment during a time of heavy growth is not normally a good investment. It is hard to know when things will level out, or if the floor will fall out of the market. Booms are a bad time to get in for most property investments, recession is a good time to get in. If the regular Joe on the street is talking about how hard it is to afford a house, then chances are things are heading for a crash. Talk to someone in a solid profession like teaching, if this person thinks housing is too expensive, then housing prices are reaching beyond regular people. Something has to give, and it could be housing prices.