Problems with interest rates and repayments? Ask for home loan help.
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A lender will allow the equity in an existing home to be used as equity for another residential property purchase. The amount of equity required is variable with some lenders allowing up to 100% borrowings for owner occupied property where Mortgage Insurance cover is taken.
Generally for investment property the lender prefers a 20% equity in the existing property. They will also prefer to have a first mortgage over the existing property. Some lenders will take a second mortgage over the existing property but will inflate the existing debt reliance when calculating equity.
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