Refinance / Restructuring
Can You Refinance Investment Property Loans?
5 min read- Finance Guide
- Updated 2026
Quick answer
Refinancing is commonly assessed up to around
60% 80%
of current property value, depending on lender policy and borrower strength
- Assessment bases Valuation, rent and servicing
- Structure options IO, P&I, fixed, variable or split
- Extra caution point Tax and purpose of borrowed funds
1300 421 044
1300 421 044
Key concepts in investment refinance
Current valuation
The lender normally orders a fresh valuation because the maximum refinance amount depends on the current market value, not the original purchase price
Rental income treatment
Lenders usually shade rent rather than using one hundred percent, and may look at the lease, vacancy risk and ongoing property costs
Serviceability
The new lender applies its own servicing test using current rates, buffered repayments, income, living costs and all existing debts
Purpose and structure
Equity release, debt consolidation, tax separation and future investment plans all affect which structure may be appropriate and which lenders may be suitable
Loan structure options
Investment loan refinancing is often about choosing a cleaner or more strategic structure rather than just chasing a cheaper headline rate.
Repayment type
Interest only or P&I
Some investors refinance to interest only for cash flow flexibility, while others move to principal and interest to reduce debt faster
Rate type
Fixed, variable or split
Refinancing can reset the loan onto a different rate type depending on how much certainty or flexibility is required
Loan splits
Separate purposes clearly
Separate splits can be useful where one part of the debt relates to the property and another part relates to a different purpose or future strategy
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Lender criteria
Lenders normally review the following when assessing an investment refinance application:
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01. Current valuation, usable equity and target LVRSecurity position
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02. Rental income, lease details and borrower servicingCash flow assessment
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03. Repayment history, credit conduct and refinance purposePolicy fit
Common problems with investment refinance
Low valuation
A lower than expected valuation can reduce usable equity, increase the effective LVR and limit how much debt can be refinanced or released.
Possible solutions include:
reduce the requested refinance amount or equity release- offer additional security if appropriate
- consider a lender with a more suitable policy for the asset type
Break costs or switching costs
Fixed rate break costs, discharge fees, new application fees and other switching costs can wipe out much of the benefit if the refinance is driven only by headline pricing.
Possible solutions include:
- compare total cost rather than interest rate alone
- time the refinance carefully if a fixed period is ending soon
- weigh pricing against better structure, features or future flexibility
Serviceability shortfall or mixed purpose debt
A borrower may be servicing the current loan, but still fail the new lender's assessment, especially if rent is shaded or the loan has been mixed with private use over time.
Possible solutions include:
- reduce the refinance amount or cash out request
- restructure into clearer loan splits where appropriate
- choose a lender whose servicing model better fits investors
Steps to get refinancing
Step
01
Review the current investment loan, property position and refinance objective
Step
02
Estimate current value, usable equity and realistic target LVR
Step
03
Prepare income, lease or rental evidence, liabilities and statements
Step
04
Select lenders and loan structures that suit the investment scenario
Step
05
Submit the application and complete valuation, assessment and any conditions
Step
06
Complete discharge, settlement and implement the new structure carefully
Speak with a Property Finance Specialist
Investment refinance scenarios can vary materially depending on the property type, rental position, valuation outcome, existing loan structure and the reason for refinancing.
A specialist can help compare lender policy, switching costs and structural options so the refinance is not just cheaper on paper but actually useful in practice.
Speak with a finance specialist about your investment refinance options.
Submit the short form below and a finance specialist can review your current investment loan, likely refinance options and the issues that may affect approval or long term benefit.
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Additional Questions
You may also find these questions helpful
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01How much can you borrow when refinancing an investment property?
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02Can you release equity from an investment property when refinancing?
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03Does refinancing affect tax deductibility on an investment loan?
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04How long does investment property refinance take?
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05Can you switch from principal and interest to interest only?
