Business loans for childcare and early learning centres
HomeSec lends to childcare and early learning operators against equity in real property, from $20,000 to $5,000,000, with no financial statements and no valuation. Funding in as little as 24 hours suits a sector where wages are fixed by staffing ratios and subsidy income arrives after the care is given.
See if you qualify in sixty seconds. No credit check to apply, no financials, no payments for the first six months. That's the HomeSec Advantage.
See if you qualifyThe cash cycle you are actually borrowing against
Childcare has the least flexible cost base of any service business, because the cost is set by regulation rather than by management. Educator-to-child ratios and qualification requirements under the national quality framework fix how many people must be rostered for a given number of children, so wages cannot be trimmed when occupancy dips — they can only be trimmed by taking fewer children, which reduces income by more than it saves.
Income arrives after the care and partly through a subsidy paid on the government's cycle rather than the centre's. Families pay gap fees on their own terms and some of them fall behind. Occupancy itself moves with the calendar: January is thin, the year builds, and a centre that opened in the wrong quarter can spend a year filling.
Compliance is the other distinctive cost. Assessment and rating, physical requirements for indoor and outdoor space, fencing, shade, kitchen and nappy-change facilities, and the works a regulator or a landlord can require are non-negotiable and carry deadlines. Centres are almost always leased and heavily fitted out, and the fit-out belongs to the premises rather than to the operator.
What makes the phone ring
| The event | What it looks like |
|---|---|
| Compliance or regulator-directed works | A requirement with a deadline attached, where the alternative to spending is a condition on the service approval. |
| Occupancy below budget in a soft quarter | Wages fixed by ratios against income that has not arrived. The shape of it is predictable; the cash is the problem. |
| Acquiring a centre or a second site | A purchase completing on a contract date, with the value largely in the service approval and the enrolments. |
| Fit-out, expansion or a playground rebuild | Works on leased premises that no lender will secure against. |
| An ATO or superannuation balance | A large, mostly part-time payroll makes PAYG withholding and super substantial, and both accrue on income that lands later. |
| A subsidy or enrolment disruption | A change in arrangements, an audit or a payment delay against a payroll that does not change. |
What you can offer as security
Almost every centre is leased, so the security is normally the operator's own property — a home or an investment property, assessed to 80% of value — with the company or trust as borrower. This is the standard structure and there is nothing unusual about it.
Where the operator owns the building, a purpose-built centre or a converted house is commercial security assessed to 70% of value and will generally carry the amount on its own.
The service approval, the enrolment list, the fit-out and the lease are not security. They are the most valuable things the business has, and none of them is something a lender can realise, which is exactly why property-secured lending is the route that works here.
How much you can borrow
Take the property's value, multiply by 80% for residential security or 70% for commercial, and subtract what is already owing on it. What is left is roughly what is available, between $20,000 and $5,000,000. Several properties can be added together, and the borrower does not have to be the owner — companies, trusts and sole traders — including start-ups, with everyone on title signing. Up to 80% on residential and 70% on commercial. Lower on large acreage, and LVRs may reduce on properties worth less than $800,000.
Why the bank is slow here, and we are not
Childcare is treated by most banks as a specialised category, which means a specialist team, a longer assessment and a lower appetite for anything that is not a large, established, freehold-owned group. An owner-operator with one leased centre is at the far end of that queue.
A serviceability test built on two years also reads a soft occupancy quarter as decline, and reads a recent acquisition or fit-out as leverage, when both may be the reason the business is about to do well.
We assess the property and the exit. Occupancy recovering, a sale completing, a bank facility landing later: any of those is an exit, and the answer comes on the first call.
What the money is used for
- Compliance and regulator-directed works. Done inside the deadline rather than negotiated against it.
- Working capital through a soft quarter. No repayments while occupancy rebuilds.
- Acquiring a centre. Completing on the contract date, refinanced later if that suits.
- Fit-out, playground and expansion. Against property, because leasehold improvements are not security.
- Clearing an ATO or superannuation balance. Paid direct from settlement, which removes the director's personal exposure on both.
- Buying the building. A first mortgage over the premises the centre occupies.
From the call to the money
Tell us the deal
Amount, purpose, timing, the property and how the loan gets repaid. A Lending Manager gives you an indicative answer on that call — usually in minutes.
Minutes
Conditional approval
Photo ID, a rates notice and your most recent mortgage statement. That is the whole list, and it takes about fifteen minutes.
About 15 minutes
Funds released
As little as 24 hours from a clean, complete scenario. Paid where you tell us — to your account, or straight to the ATO.
As little as 24 hours
What it costs
Priced per file, on the property, the position, the amount and the exit. No rate is published, because a rate with "from" in front of it is the best file's number. How it is priced, and every fee that exists.
Questions we get from this industry
Can a leased centre borrow?
Do you lend against the service approval or the enrolments?
Can we fund works a regulator has required?
We are buying a second centre. Can you fund the completion?
Do you require financials, occupancy data or subsidy statements?
We have unpaid superannuation. Does that stop a loan?
Is there a minimum trading period?
How long can we hold the loan?
Not a call centre. Tell us the property, the amount and what the money is for, and you will have an indicative answer on the call. 1300 93 83 87, Mon–Fri, 8:30am – 5:30pm Melbourne time.
The assessment is the same in every one of them: property, purpose and exit.
See if you qualify in sixty seconds
Three short questions, no credit check to apply and no financial statements. A Lending Manager reads it and calls you back with a real answer — not a call centre, not an algorithm.
That's the HomeSec Advantage.
Reviewed by Catriona Anderson, General Manager