Considerations when applying for a property investment loan

Taking out a property investment loan is a big step and while it may seem like it's one you want to make, it's important to ascertain if this is definitely the case.

After all, a property investment is often made with the intention of generating income, so the figures need to fall into place before you submit that loan application. 

Asking yourself some key questions could be the difference between making an investment that works for you and avoiding a deal that may turn sour.

Can you afford the repayments?

No matter what type of loan you're taking out, it's crucial to ask yourself whether you can afford to meet the repayments.

While they might seem manageable at face value, factor in all the other expenses you face in your everyday life before making that final decision. 

What are the returns on the investment likely to be?

Once you've spotted a property you think will be perfect to invest in, it's time to let your head rule your heart and decide if it's going to offer the returns you had hoped for.

If you're trying to appeal to the family market then is it close to local schools? Or if tenants that are young professionals are on the cards, is the property near transport links?

What is your investment strategy?

Taking on a property is more than just about finding the best investment home loan – you need to think carefully about what you want to achieve in both the short and long term.

You might be buying real estate with a view to selling it on in a few years' time, or hoping to rent it out indefinitely. Whatever your strategy is, ensure it's clear in your mind from the outset.