The mortgage rate you lock in today directly affects your investment returns tomorrow. For property investors, shaving even a fraction off your interest rate can mean thousands in savings over the life of a loan—not to mention improved cash flow, better serviceability, and faster access to equity for your next deal.
But securing the lowest mortgage rate for an investment property isn’t just about choosing the cheapest option advertised online. It’s about understanding how lenders assess your profile, how different loan structures affect pricing, and how to negotiate or leverage broker access for the most competitive terms.
In this guide, we’ll walk through every step to help you secure a sharp rate, boost your borrowing power, and build a portfolio that performs.
Step-by-Step Guide to Securing the Best Investment Loan Rate
1. Strengthen Your Borrowing Profile
Lenders want low-risk borrowers. The stronger your financial position, the better the deal you’ll be offered.
Key Strategies:
- Boost Your Credit Score
Aim for 700 or higher. Pay bills on time, reduce credit card limits, and avoid unnecessary credit applications. - Minimise Personal Debts
Clear personal loans, car finance, and consumer debts where possible. Fewer liabilities mean higher borrowing capacity and better pricing. - Document Stable Income
If you’re PAYG, demonstrate a consistent employment history. If self-employed, provide clean, up-to-date tax returns and business activity statements. For investors, ensure rental income is well-documented.
2. Optimise Your Loan-to-Value Ratio (LVR)
Your LVR—the percentage of the property’s value you’re borrowing—has a major impact on rate.
- 80% or Lower
This is the magic number. Most lenders offer their best rates at or below this threshold. - 70% or Lower
Some lenders provide even sharper pricing when LVR drops into this ultra-low risk tier.
How to Lower Your LVR:
- Increase Your Deposit
More cash upfront reduces lender risk. - Use Existing Equity
Tap into equity from another property to boost your deposit and bring your LVR down.
3. Choose the Right Loan Structure
Loan type influences not just your repayments—but your rate.
Fixed vs Variable
- Fixed: Locks in your rate for 1–5 years. Best for certainty and budget control.
- Variable: Fluctuates with the market. Often lower upfront and includes offset/redraw options.
Interest-Only vs Principal & Interest (P&I)
- Interest-Only: Lower repayments during the interest-only period. Better short-term cash flow, but often comes with a slightly higher rate.
- P&I: Reduces principal from day one. Typically attracts lower rates and builds equity faster.
Investor Tip: Some banks offer sharper P&I rates to encourage long-term repayment behaviour. Others may reward interest-only loans with flexible features if the overall LVR is low.
4. Compare Lenders and Negotiate Like a Pro
The mortgage market is more competitive than ever, especially in the investment lending space. Rates can vary widely depending on the lender, loan size, and your profile.
Best Comparison Tools:
- RateCity
- Canstar
- Finder
- Mozo
These platforms allow side-by-side comparisons of investment loan rates, features, and fees.
But don’t stop there:
- Contact multiple lenders directly and ask for rate match offers.
- Ask about investor packages—some lenders will offer sharper pricing for loans over $500,000 or for investors with multiple properties.
- Use comparison quotes to negotiate down your existing lender’s offer.
Even a 0.10% rate reduction on an $800,000 loan saves over $8,000 across a five-year term.
How Key Financial Metrics Influence Loan Pricing
Understanding what lenders care about helps you reverse-engineer your application to secure better terms.
1. Credit Score and History
Here’s how lenders typically view credit scores:
- 800+ (Excellent): Top-tier rates, maximum loan flexibility
- 700–799 (Good): Still competitive, but may require more documentation
- 600–699 (Fair): Expect higher rates and tighter conditions
- Below 600: Consider non-bank or specialist lenders
Other red flags include:
- Missed repayments
- High credit utilisation
- Frequent credit applications
Clean up your credit file before applying—it’s one of the most powerful ways to reduce your interest rate.
2. Loan-to-Value Ratio (LVR)
As mentioned earlier, this directly impacts pricing:
- ≤80%: Access to full lender panels and best rates
- 80%–90%: Higher rates, and Lenders Mortgage Insurance (LMI) usually applies
- 90%+: Limited options, significant LMI, and premium pricing
Some lenders reward ultra-low LVRs (e.g. 60–70%) with exclusive investor rate discounts.
3. Serviceability and Debt-to-Income Ratio
Lenders run detailed calculations to determine how comfortably you can meet repayments.
Key factors:
- Net Income: Includes salary and rental income (some lenders accept 80%, others 100%)
- Personal Living Expenses: Keep declared costs realistic—but accurate.
- Debt-to-Income Ratio (DTI): Try to stay under 6x annual income for a better rate and easier approval.
Secret Incentives and Rate Sweeteners Banks Don’t Advertise
Beyond the rate itself, some lenders offer incentives that can significantly improve your overall loan value.
1. Cashback Offers
- $2,000–$5,000 for switching or refinancing to certain lenders
- Usually available for loans over $250,000–$500,000
- Can offset application fees or act as upfront savings
2. Discounted Loan Packages
Bundling products like:
- Offset accounts
- Credit cards
- Insurance
Can qualify you for rate discounts of 0.10–0.20%, especially with major banks.
3. Fee Waivers and Pro Discounts
Some lenders waive:
- Annual package fees (usually $395–$450)
- Valuation or application fees
- LMI for certain professions like doctors, accountants, engineers
High-income borrowers with strong credit may also access exclusive pricing tiers not visible to the general public.
Working with a Mortgage Broker: Your Secret Weapon
Trying to go direct with banks? That works—but only to a point. Mortgage brokers often have access to better rates and more flexible loan policies than what you’ll find online.
Why Use a Broker?
- Access to Exclusive Rates not advertised on lender websites
- Tailored Structuring to fit your investment goals
- Time Savings—no paperwork stress or rate haggling on your end
What to Look for in a Broker
- Specialist in Investment Lending
- Strong panel of lenders (banks + non-banks)
- Clear, transparent fee structure (most are paid via lender commissions)
Reputable firms include:
- Aussie Home Loans
- Mortgage Choice
- Loan Market
- As well as independent brokers with strong investor reviews
Final Thoughts: Locking in the Best Investment Rate in 2025
The lowest mortgage rate isn’t handed out to the first applicant—it’s earned through smart financial preparation and sharp negotiation.
Here’s your action plan:
- Get your credit score and financials in top shape
- Keep your LVR at 80% or lower
- Understand whether fixed, variable, or interest-only suits your strategy
- Compare lenders using real-time tools and negotiate aggressively
- Use a broker to tap into exclusive deals and structure loans properly
- Consider cashback and package discounts to reduce total costs
The goal isn’t just to secure the lowest rate today—but to set yourself up for stronger returns, easier equity access, and greater borrowing power tomorrow.
Need Help Finding the Right Loan?
If you’re ready to secure the lowest mortgage rate for your investment property—or just want to compare your options—let’s have a chat. We’ll help align your loan structure with your investment goals and negotiate the best deal possible.