Recently we have been noticing a trend among builders and developers.
We have been talking over the past year about the astonishing length of time it now takes for banks to pick up your file; let alone process your private or commercial loan.
This is being reflected in that a staggering number of our existing clients from the building and property development industries are now taking to purchasing properties without bothering to get pre-approvals from the banks. This might sound like risky business, but it can actually be a great financial strategy, if you know that a HomeSec short term Business Bridging Loan exists.
What many of our clients are doing is purchasing a property on the spot, and then borrowing short term from HomeSec Business Finance, while they put their funding in place from a mainstream bank. At HomeSec, we can have the funds available to you in under 24 hours. If you have an opportunity that is too good to miss; it makes good sense to strike while the iron is hot..
Time is money!
Time is money, and most business owners do not want to have to wait months for another opportunity to come their way for the sake of having their funding in place.
So, let us say, for example, you have purchased a house, land or commercial property, and you are looking to turn it into apartments. What many of our clients are doing is borrowing the funds from us to enable a 30 purchase. Offering 30 day settlement terms is often a great way of getting a lower purchase price; especially if it is a distressed sale. Or if it is mortgagee in possession sale, 30 days is the maximum term in any case, so you need to have your ducks well and truly in a row.
Then, knowing you have secured the property as your funding is in place. Use the 1 to 2 months or so that it takes to secure the long term finance with the bank. Then organise the plans and permits to submit to the council.
This way a developer can have their permits approved by the time their finance is secured; and they can commence works almost immediately without wasting any time. Not a bad way to save two months on a business opportunity.
When the client does go to the bank, they can even get construction funding; so they do not need to enter a different stage of finance. It is worth noting that since our loans are for a business purpose; you can offset the interest repayments against your profit, as they are tax deductible.
It pays to have options in this world, and we think this is a new savvy way of using our product. So, if you have an opportunity too good to miss, do not let it pass you by. You do have options as a business owner. So, talk to one of our business development managers at HomeSec Business Finance today about how we can help you achieve your business goals faster.
