27 Oct 2021

Purchase a Positively-Geared Investment Property in the Name of the Lowest Income Earner

The lending specialists at Mortgage House understand how overwhelming it can be to manage your monthly mortgage repayments. We work with all of our customers to find the perfect mortgage minimisation strategy for them. One of our most popular options is for couples or two-income households to purchase a positively-geared investment property in the name of the lowest income earner. 

What is a Positively-Geared Investment Property?

As its name suggests, a positively-geared property is when the income you receive from rent is higher than everyday expenses associated with your property. These expenses include both the interest on your loan and maintenance and upkeep. If you own a positively-geared investment property, you are most likely making a profit, which means you have extra money at your disposal every month. However, it is important to note that this extra money is subjected to tax. 

How Does Purchasing One Help Minimise Your Mortgage?

As stated above, purchasing a positively-geared investment property increases your disposable income each month. You can use this extra income to minimise your mortgage by paying extra towards your monthly repayments. If a dual-income household is interested in purchasing a positively-geared property, it is important to buy one in the name of the person with a lower income. This is important because a lower income gives you more incentives, resulting in a lower principal loan amount, which can create more a higher profit margin when you sell the investment property, allowing you to pay off a larger chunk of your mortgage. 

Purchasing a positively-geared property can help you mimimise your mortgage. Contact the lending specialists at Mortgage House today to learn more.

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