Last Updated: 22nd January, 2018

Significant Investor Mortgages

Published by Otto Dargan on May 26, 2014

Are you a high net worth (HNW) foreign investor seeking to invest in Australia? Since the Australian government introduced its Significant Investor Visa (SIV) scheme in November 2012, it has never been a better time for foreigners to invest in a vibrant and diverse economy.

Best of all, Home Loan Experts specialises in lending to foreign HNW clients who want to purchase residential or commercial investment properties with negotiated, competitive interest rates and loan terms.

What is the SIV and why is it so significant?

The SIV came into effect as a new stream within the Business Innovation and Investment (Provisional) (Subclass 188) and the Business Innovation and Investment (Permanent) (Subclass 888) visa on 24 November 2012.

To be eligible for the visa, foreigners are required to invest a minimum of $5 million into complying investments. These are:

  • Australian Securities and Investment Commission (ASIC) regulated managed funds with a mandate for investing in Australia.
  • Commonwealth, State and Territory government bonds.
  • Direct investment into Australian proprietary companies.

Because of the significant investment being made, the SIV waives certain visa requirements that would normally apply to migrants:

  • There is no English language threshold requirement.
  • There is no need to satisfy the innovation points test.
  • There are no upper age limits.
  • There is no limitation placed on you or your family when holding a provisional SIV in Australia.

Why are investors often buying real estate?

Although residential and commercial investment properties do not count as complying investments during the four-year provisional period of your visa, you can decide for yourself what you want to do with your complying investments once you are granted a permanent SIV.

According to the terms of the visa, “to be granted a permanent Significant Investor Visa, you must genuinely have a realistic commitment to maintain business or investment activities in Australia, but they do not need to be complying investments.”

As such, many SIV holders choose to buy Australian real estate once they have reached the minimum $5 million amount in complying investments.

How can we help you to buy real estate?

Our brokers are experts in helping SIV holders to borrow to purchase more investments:

  • Borrow up to 80% of the property value for residential investment properties.
  • Borrow up to 75% of the property value for commercial investment properties.
  • Borrow up to 65% of the value of other assets such as businesses that you are buying.

If you’re looking to buy a property to live in, we’ve also negotiated special deals for luxury properties, including the ability to borrow 80% of the property value for loans over $1,000,000 and 75% of the property value for loans over $2,000,000.

To apply for a mortgage in Australia, you need to prove that you can afford the loan. This can be from the income from Australian assets you own, your foreign income or a mix of two.

Whether you are employed in Australia or overseas, you need to provide evidence of your job. One of our brokers can tell you what other documents you’ll need to provide when applying for a mortgage in Australia. Please call us on 1300 889 743 or enquire online.

What sets Home Loan Experts apart?

Our team of mortgage brokers have extensive industry experience and all of them have previously worked in the credit departments of the major banks and lenders. That means we can get your mortgage approved faster and negotiate interest rates much lower than other mortgage brokers.

We commonly deal with the foreign investor market, particularly Chinese nationals. And we know how to speak your language, literally: we have staff that can assist with translating.

More importantly, we understand the needs of high-end professional investors wishing to purchase properties in bulk.

Specialist advice for investors

On top of all this, we know the tips that banks and other brokers won’t tell you that could save you thousands in fees and taxes:

  • Having an offset account is really useful if you are bringing large amounts of cash to Australia. You can buy several properties, borrow 80% of the value and then put your excess cash into the offset account until it is needed.
  • We often tell our international investors with large deposits to set up their loan amount and rent on a residential investment property to work out as neutrally-geared. If you make a profit then you will have to pay tax at the highest tax bracket on all income derived so having the property neutrally-geared is a better option for you.
  • We can provide you with unbiased property reports about prime locations for real estate investment, answers that are often spoon fed through sales people at other brokerages.

If you’re on a provisional or permanent significant investor visa holder, call us on 1300 889 743 or enquire online to discuss your investment plans with one of our expert brokers.

Apply for the premium investor visa

After submitting an expression of interest for the Business Innovation and Investment (Provisional) visa (subclass 188) in SkillSelect, the criteria for deciding which applicants will be nominated varies from state to state. See your state government website for more details.

How to extend your visa

Your provisional visa will last for four years from the date it is granted. If you meet certain requirements, you may be eligible to extend your stay under an extension stream if you hold this visa under the Business Innovation stream or the Significant Investor stream and need extra time to meet the criteria for a permanent (subclass 888) visa.

Provisional visa holders in the Significant Investor stream can apply for up to two extensions for a total of additional four years so your visa can last up to eight years.

For more information about the SIV, see the Australian Department of Immigration and Border Protection website.

Since the visa came into effect, over 545 foreign nationals have applied for the visa, with more than 90% coming from China as at February 2014, according to recent figures from the Australian Department of Immigration and Border Protection.

To date, around 65 visas have been officially granted under the program with 7,260 places allocated to the Government’s entire Business Innovation and Investment program for 2013/14.