Investment Property Loans
It should be remembered that any loan repayments will include the capital as well as the interest. So when comparing this against an interest only mortgage, then a loan becomes inefficient. You'll probably have to put down 25% instead of perhaps 10% and the rates will be higher. It is the 25% that is tied up in the property that makes this an inefficient method to finance the asset. 
Of course there may be times when a loan is necessary - for example if you can't get a mortgage just at that time or if you need to co borrow against a property. However, there is a market for them so they must sell!
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