Can someone please explain the different requirements between obtaining construction finance for an investment property vs. primary residence - particularly as it relates to interest rates and LVR
Lending requirements are typically tighter for investment property loans as compared to primary residence loans, especially in the last few years.
For example, you would probably need at least a 10% deposit for an investment loan (many banks now require 20%) - for primary residence, its a 5% minimum. And interest rates are higher for investment loans...
Have a look at a site like Finder.com.au for a quick comparison:
Investment Loans: https://www.finder.com.au/home-loans/investment-property-home-loans
Home Loans (owner occupied): https://www.finder.com.au/home-loans
As you can see, its at least a 0.50% difference in rates.Edited on 11-05-2017 14:07