Investment lending
Investment property loans for Australian property investors.
Investment property lending differs from owner-occupier in pricing, loan structure, tax treatment and serviceability assessment. Maxfin structures investment loans so the lending works for both the current property and the next purchase, without the common mistakes that compound across a portfolio: cross-collateralisation, single-lender concentration, suboptimal offset placement, and lender-selection that misses the new prudential constraints introduced in 2026.
What we cover
The lending Maxfin structures in this category.
- 01
Single-property investment loans
Standard residential investment lending across the panel. Variable, fixed, interest-only or principal-and-interest, with offset and redraw structured to maximise tax-deductible debt and preserve future flexibility. Pricing typically carries a small premium over owner-occupied lending, and the assessment treatment of rental income varies by lender (commonly 70% to 80% of gross rent included in servicing).
- 02
Multi-property portfolio structures
Lending across multiple investment properties, with cross-collateralisation avoided where possible and serviceability optimised across the lender panel. The number that matters is not the headline borrowing capacity at one lender; it's the position across the panel after the next purchase settles. Lender selection at the next purchase compounds across every future purchase.
- 03
Interest-only periods and resets
Setting up appropriate interest-only periods on investment debt, with the transition to principal-and-interest planned for ahead of time. Lender policy commonly limits the maximum interest-only term to around five years on owner-occupied loans, with longer cumulative terms sometimes available on investment lending across resets. There is no current APRA-mandated maximum on interest-only term length; the limits are set by individual lenders.
- 04
Equity release for the next purchase
Releasing equity from an existing property to fund the deposit and stamp duty on the next, with the structure set up to keep the deductible-debt purpose clear. The cleanest pathway is generally a separate split for the equity release, drawn down at the time of the new purchase, so the ATO purpose-of-borrowed-funds test is unambiguous.
- 05
Offset accounts on investment debt
Offset accounts can preserve deductibility while parking idle cash, instead of paying down principal that may not be easily redrawn for investment purposes without affecting deductibility. The default Maxfin structure for new investment loans is interest-only with offset, which keeps the principal balance intact and provides flexibility for future use changes. Tax treatment is general in nature; advice on a specific tax position should be obtained from a registered tax agent.
- 06
SMSF residential lending (LRBA)
Limited recourse borrowing arrangements for self-managed super fund residential property, structured to comply with SIS Act requirements (separate bare trust, single-asset rule, no improvements that change the property's character). Typical 2026 SMSF residential parameters: 20% to 30% deposit (LVR caps commonly 70% to 80%), rate premium of 0.5% to 1.5% above standard investment rates, minimum fund balance of $250,000+ (some lenders require $300,000 to $350,000), and increased lender focus on post-settlement liquidity buffers, subject to lender criteria.
- 07
DTI cap-aware lender selection
From 1 February 2026, APRA requires lenders to limit new mortgage lending at debt-to-income ratios of six or higher to no more than 20% of new flows, applied separately to owner-occupier and investor portfolios. The right lender for an investor file is no longer just the one with the most generous servicing calculator; it is also the one with current capacity under the DTI cap. That capacity moves quietly from quarter to quarter.
01Single-property investment loans
Standard residential investment lending across the panel. Variable, fixed, interest-only or principal-and-interest, with offset and redraw structured to maximise tax-deductible debt and preserve future flexibility. Pricing typically carries a small premium over owner-occupied lending, and the assessment treatment of rental income varies by lender (commonly 70% to 80% of gross rent included in servicing).
02Multi-property portfolio structures
Lending across multiple investment properties, with cross-collateralisation avoided where possible and serviceability optimised across the lender panel. The number that matters is not the headline borrowing capacity at one lender; it's the position across the panel after the next purchase settles. Lender selection at the next purchase compounds across every future purchase.
03Interest-only periods and resets
Setting up appropriate interest-only periods on investment debt, with the transition to principal-and-interest planned for ahead of time. Lender policy commonly limits the maximum interest-only term to around five years on owner-occupied loans, with longer cumulative terms sometimes available on investment lending across resets. There is no current APRA-mandated maximum on interest-only term length; the limits are set by individual lenders.
04Equity release for the next purchase
Releasing equity from an existing property to fund the deposit and stamp duty on the next, with the structure set up to keep the deductible-debt purpose clear. The cleanest pathway is generally a separate split for the equity release, drawn down at the time of the new purchase, so the ATO purpose-of-borrowed-funds test is unambiguous.
05Offset accounts on investment debt
Offset accounts can preserve deductibility while parking idle cash, instead of paying down principal that may not be easily redrawn for investment purposes without affecting deductibility. The default Maxfin structure for new investment loans is interest-only with offset, which keeps the principal balance intact and provides flexibility for future use changes. Tax treatment is general in nature; advice on a specific tax position should be obtained from a registered tax agent.
06SMSF residential lending (LRBA)
Limited recourse borrowing arrangements for self-managed super fund residential property, structured to comply with SIS Act requirements (separate bare trust, single-asset rule, no improvements that change the property's character). Typical 2026 SMSF residential parameters: 20% to 30% deposit (LVR caps commonly 70% to 80%), rate premium of 0.5% to 1.5% above standard investment rates, minimum fund balance of $250,000+ (some lenders require $300,000 to $350,000), and increased lender focus on post-settlement liquidity buffers, subject to lender criteria.
07DTI cap-aware lender selection
From 1 February 2026, APRA requires lenders to limit new mortgage lending at debt-to-income ratios of six or higher to no more than 20% of new flows, applied separately to owner-occupier and investor portfolios. The right lender for an investor file is no longer just the one with the most generous servicing calculator; it is also the one with current capacity under the DTI cap. That capacity moves quietly from quarter to quarter.
Approach
How Maxfin structures it.
First investment property, owner-occupier converting to investment
An owner-occupier upgrading the family home and keeping the existing property as an investment. Maxfin restructures the existing loan so deductible and non-deductible debt stay separate, and sizes the equity release for the new home correctly. The structural setup at this point determines the deductibility profile for the next decade of portfolio decisions, so the conversation with the borrower's accountant is coordinated before settlement, not after.
Buying property number two with equity release
Equity release from property one funds the deposit and acquisition costs on property two. Servicing is tested across both properties, with the existing investment loan assessed at the APRA serviceability buffer (currently 3% above contracted rate). The structure is built with property three in mind: split loans for clear purpose accounting, no cross-collateralisation, offset placed on the highest non-deductible balance.
Restructure of a multi-property portfolio
De-cross-collateralising a portfolio that's grown without a deliberate structure, freeing up equity, and resetting serviceability across lenders to support continued purchases. Releasing a security from a cross-collateralised structure is rarely simple. Maxfin sequences the discharges, the new lender approvals, and the valuations so the restructure completes without leaving the borrower in a worse position mid-stream.
SMSF investment property purchase via LRBA
Self-managed super fund acquisition of a residential investment property through a limited recourse borrowing arrangement. The structure requires a separate bare trust, satisfies the single-asset rule, and meets the lender's post-settlement liquidity requirement (commonly 5% to 10% of asset value). Maxfin coordinates with the SMSF's accountant and auditor to ensure the LRBA documents and fund position both meet the lender's and SIS Act's requirements before progressing.
High-DTI investor approaching the new prudential cap
An investor with three existing properties whose proposed next purchase pushes the file above DTI of six. Maxfin maps which lenders currently have headroom under their DTI cap, identifies whether the file fits any of the cap exemptions (bridging loans and new-dwelling construction are exempt), and sequences the application accordingly. A file that would have approved last quarter may decline this quarter at a lender close to its cap.
First investment property, owner-occupier converting to investment
An owner-occupier upgrading the family home and keeping the existing property as an investment. Maxfin restructures the existing loan so deductible and non-deductible debt stay separate, and sizes the equity release for the new home correctly. The structural setup at this point determines the deductibility profile for the next decade of portfolio decisions, so the conversation with the borrower's accountant is coordinated before settlement, not after.
Buying property number two with equity release
Equity release from property one funds the deposit and acquisition costs on property two. Servicing is tested across both properties, with the existing investment loan assessed at the APRA serviceability buffer (currently 3% above contracted rate). The structure is built with property three in mind: split loans for clear purpose accounting, no cross-collateralisation, offset placed on the highest non-deductible balance.
Restructure of a multi-property portfolio
De-cross-collateralising a portfolio that's grown without a deliberate structure, freeing up equity, and resetting serviceability across lenders to support continued purchases. Releasing a security from a cross-collateralised structure is rarely simple. Maxfin sequences the discharges, the new lender approvals, and the valuations so the restructure completes without leaving the borrower in a worse position mid-stream.
SMSF investment property purchase via LRBA
Self-managed super fund acquisition of a residential investment property through a limited recourse borrowing arrangement. The structure requires a separate bare trust, satisfies the single-asset rule, and meets the lender's post-settlement liquidity requirement (commonly 5% to 10% of asset value). Maxfin coordinates with the SMSF's accountant and auditor to ensure the LRBA documents and fund position both meet the lender's and SIS Act's requirements before progressing.
High-DTI investor approaching the new prudential cap
An investor with three existing properties whose proposed next purchase pushes the file above DTI of six. Maxfin maps which lenders currently have headroom under their DTI cap, identifies whether the file fits any of the cap exemptions (bridging loans and new-dwelling construction are exempt), and sequences the application accordingly. A file that would have approved last quarter may decline this quarter at a lender close to its cap.
Common questions
Frequently asked.
Should investment loans be interest-only?
Often, yes. Interest-only periods preserve cash flow and keep deductible debt levels stable. The tax position generally favours interest-only on investment debt because interest is deductible and principal repayments are not. The trade-off: interest-only carries a rate premium of typically 0.20% to 0.40% above principal-and-interest, and lenders calculate serviceability on the underlying P&I obligation that follows the IO period. The decision is best made on tax and cash-flow grounds, with advice from a registered tax agent on the specific tax position. Subject to lender criteria.
How is rental income treated in servicing?
Most lenders include 70% to 80% of gross rental income in servicing. The remainder is generally assumed to cover vacancy, maintenance, agent fees, insurance and rates. Some lenders take 100% of gross rent and apply a higher operating-expense haircut elsewhere; the net outcome is usually similar. Several lenders tightened their rental-income shading through early 2026 as part of broader investor-lending tightening. Holiday-let, short-stay and Airbnb income tend to be treated more cautiously.
How do I keep my borrowing capacity for the next property?
By choosing lenders that assess existing investment debt at smaller buffers where the loans are fixed or otherwise demonstrably stable, by avoiding cross-collateralisation, and by structuring loan splits so each property's debt is identifiable and separable. Lender selection at the current purchase shapes every future purchase. Maxfin maps the panel position before recommending where to submit, not after.
Does negative gearing improve my borrowing capacity?
Rarely in a meaningful way. Negative gearing is a personal tax position; it doesn't change the cash flow the bank sees from the property itself. Some lenders will add back the tax saving from negative gearing to assessable income, using their assumed marginal rate. Many do not. Where it is added back, a $20,000 annual negative-gearing benefit at the personal level might add $4,000 to $7,000 to assessable income at the lender, subject to lender criteria.
Can I buy investment property in my SMSF?
Yes, via a Limited Recourse Borrowing Arrangement (LRBA). The structure has specific compliance requirements: separate bare trust, single-asset rule, no improvements that change the property's character. SMSF lender requirements typically include 20% to 30% deposit (LVR caps commonly 70% to 80% for residential), minimum fund balance of $250,000+ (some lenders require $300,000+), and a post-settlement liquidity buffer of around 5% to 10% of asset value. Maxfin coordinates with the SMSF's accountant and auditor to confirm fund eligibility before lender submission. Subject to lender criteria.
What is the new DTI cap and how does it affect investors?
From 1 February 2026, APRA requires lenders to limit new mortgage lending at debt-to-income (DTI) ratios of six or higher to no more than 20% of new flows. The cap applies separately to owner-occupier and investor portfolios, measured quarterly. Bridging loans and loans for the construction or purchase of new dwellings are exempt. Practical effect for investors: lenders close to their cap may decline files that previously would have approved, so lender selection now factors in current cap headroom alongside servicing calculator.
Should I buy in a trust structure?
Trust ownership of investment property carries trade-offs. Income and capital can be distributed across beneficiaries to manage personal tax positions year by year. Asset protection is improved relative to personal name. The lender panel narrows materially: around half of residential lenders decline trust-based applications outright, and personal guarantees from beneficiaries are typically required. Maxfin works regularly with discretionary and family trust structures and coordinates with the borrower's accountant on whether the structure benefits the specific situation.
What's the difference between cross-collateralisation and standalone lending?
Cross-collateralisation secures multiple properties against a single loan or facility. It can simplify a single transaction but constrains every future one. Releasing a property from a cross-collateralised structure is rarely simple; the lender holds discretion over the release. Standalone lending keeps each property's loan separate, with each property securing its own debt only. The default Maxfin structure is standalone unless there is a specific reason to cross-collateralise.
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