Investment Insight: Should I pay off my home loan or my rental loan first?

How you set up your mortgage payments for different properties can affect your lifestyle and your future – get the right advice to make the best financial decisions.

Paying the mortgage on your investment property is not the same as paying for the mortgage on your primary residence.

Generally speaking, your long-term objective should be to pay off all your mortgages - but how you do this could differ depending on the purpose of the property and your retirement goals.

Here's what you need to know:
  • The biggest difference between a mortgage on your rental property and a mortgage on your home is that the interest on the rental property is tax deductible
  • You still need to make payments for the money you have borrowed for your rental property, but we reduce this to just cover the interest cost
  • Most banks will allow up to five years' interest only at a time

With any loan structure, it is important to take your individual circumstances into account. If you want a review of your current loan structure, contact us on 0800 500 510 or mortgages@apexgroup.co.nz.


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