7 ways Investors are capitalizing on Low Interest Rates


What is one way you are capitalizing on low-interest rates?

To help you take advantage of low interest rates, we asked seven finance experts and business leaders this question for their best insights. From refinancing existing debts to looking into preferred securities, there are several suggestions that may help you benefit from the low interest rates in the current market. 

Here are seven tips for capitalizing on low-interest rates:   

  • Work with a Finance Broker
  • Get into Commercial Real Estate
  • Refinance Existing Debts
  • Consider FHA Loans
  • Maximize your Return on Investment
  • Set up a Line of Credit
  • Look into Preferred Securities 

Work with a Finance Broker

As a commercial finance broker, we work with our clients to make sure they can take advantage of low interest rates based on a thorough financial analysis of their company. By analyzing your credit and financial health, we act as an advisor to clients for the best financing options available. We also build leases and loans that are competitively priced and intelligently structured for an optimal plan that works for the client and incorporates the best rates possible.  — Carey Wilbur, Charter Capital

Get into Commercial Real Estate 

If you’ve been wondering whether or not to buy commercial real estate, I think it is time to take advantage of the “perfect storm” of low borrowing rates. You’ll save a lot of money on interest payments long term. Now is the perfect moment to acquire real estate for assets as an income-generating resource. So whether you need a warehouse, brick-and-mortar store outlet, or even commercial property to place on the rental market, this might be one of the best times to get in the market. Renting your commercial property will provide you with consistent income, and you might also benefit from tax advantages on depreciation and capital gains, to name a few. — Allan J. Switalski, AVANA Capital

Refinance Existing Debts 

I suggest you consider refinancing your small business loan, mortgage, or student debt, which entails paying off your existing loan by taking out a new one. The new loan will have a reduced interest rate. Ideally, opt for a fixed-rate loan to lock in the lower rate. To qualify, you’ll need strong credit, but if you do, you’ll save a lot of money on interest fees. — Sundip Patel, LendThrive

Consider FHA Loans

FHA Loans are a great low-interest lending option that is offered by the Federal Housing Administration. These loans are intended to increase homeownership access to those who may not have the ideal credit score required by other financing options. This can be a great option for prospective real estate investors. — Than Merrill, FortuneBuilders

Maximize your Return on Investment

When interest rates are low, borrowing is much more convenient.

When it comes to maximizing your investments, the dependent variable is how much money you can put into your venture. Borrowing at a low interest rate and funneling this money into an investment vehicle allows one to maximize their returns while managing their risk within reason. Obviously, this isn’t as effective when interest rates are higher, which would discourage borrowing and large-scale investing.

Take advantage of a low-interest-rate environment and create a profitable scenario for yourself. As always, consider your own risk tolerance and don’t overleverage yourself in a venture you haven’t thoroughly researched. — Brandon Brown, Grin

Set up a Line of Credit

I recently set up a line of credit as a way to take advantage of low interest rates. While my business and cash flow, in general, are positive, I find that the line of credit has several major advantages.  First, the credit line provides peace of mind — even if there was a sudden shift in my income, I would still have access to funds. Second, having available credit helps improve your credit rating over time. Since there are no maintenance costs for leaving the credit line unused, it makes sense to have it open. — Michael Alexis, TeamBuilding

Look into Preferred Securities

Preferred securities are a type of hybrid investment that has a fixed par value, or face value, and pays out coupons on a regular basis, similar to bonds. They may also have credit ratings, extended or no maturity periods, and be callable or redeemable by the issuer by a specific date. Preferred stockholders have a stronger dividend claim than common stockholders but a smaller claim than bonds. — Saskia Ketz, Mojomox

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