HOW LONG BEFORE I CAN EXTRACT EQUITY ?
The question of how long you wait before you can extract equity on an investment property comes down to several different factors. These includes things such as;
- The type of property purchased
- The policies of your lender and your servicing position with the bank.
- The policies of your lenderyour servicing position with the bank.
- Your servicing position with the bank.
BEFORE AND AFTER PRUDENTIAL CHANGES TO LENDING
Before lending restrictions were introduced in 2015, Nathan was, in some cases, able to access equity from properties he purchased under market value only one week after settlement.
Since APRA tightened the rules, Nathan has found it will generally take at least six to 12 months before investors can access their equity.
LENDERS HAVE DIFFERENT POLICIES
Not all lenders will allow investors to access equity in the same way. Some lenders impose a $10,000 limit on the amount that can be taken out, while others require cross-securitization to complete the deal.
TALK TO A FINANCE STRATEGIST
More than ever it is important to speak with a finance strategist such as Zinger Finance, who has a proven track record with helping property investors build portfolios. A finance strategist will be able to set you up in the right loans with lenders who will give you the most mileage.
This should prevent you from getting stuck and ensure you know what your options are when you want to expand.
Have you become stuck because your lender won’t let you touch your equity? Please share your experiences in the comments section below.