The role of loan structure in property portfolios

2 min read

23rd November 2023

When it comes to property investment, there's more to think about than just choosing the right property. One element that can make or break your success is loan structure. That’s because your home loan’s structure can influence your capacity to grow your investments, as well as affect your financial flexibility and risk exposure.

Understanding loan structure

Loan structure refers to the way your mortgage is set up, including aspects such as:

  • The type of loan (e.g., interest-only or principal and interest).
  • The term length.
  • Interest rate type (e.g., fixed or variable).
  • The security provided, which may involve collateral such as your home or other assets.
  • Any features like an offset account or redraw facility.

Think of it as the blueprint of your mortgage, outlining how and when you'll repay the borrowed amount

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The Important of Loan Structure

Here are five reasons why having the right loan structure for your circumstances is critica

Cash flow management

Property investment is as much about cash flow as it is about capital growth. A smart loan structure can ensure that you're not overextending yourself, and have the liquidity needed to cover expenses or take advantage of new opportunities.

Growth and diversification

If you're aiming to expand your property portfolio, the right loan structure can facilitate growth, allowing you to leverage existing assets to purchase new ones.

Risk management

Separate loans for separate properties mean that if you face financial hardship with one property, it doesn't necessarily jeopardise your entire portfolio.

Maximising tax benefits

Australia's tax system allows property investors to claim certain deductions. A correctly structured loan can help you make the most of these.


As with any investment, the future is unpredictable. A flexible loan structure can adapt to changing circumstances, be it personal or market driven.

Final thoughts

Building a property portfolio in Australia can be an exciting journey. However, the foundation of any successful property investment isn't just the property itself but also the loan structure behind it.

No two investors are the same. So it can be a good idea to work with an expert advisor, such as Vie Finance & Insurance, who can provide tailored advice, ensuring your loan structure supports your long-term goals.

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