Commercial loans and commercial lending

A commercial loan is a loan to a business for a business purpose — and, in the other sense of the phrase, a loan secured by commercial property. HomeSec writes both: $20,000 to $5,000,000, secured by commercial property to 70% LVR or residential to 80%, funded in as little as 24 hours, with no valuation and no financials. Commercial lending without the bank's timetable.

Two things people mean by "commercial loan"

The phrase does double duty, and it is worth separating the two before anything else, because the answer to "can HomeSec help" is yes to both but for different reasons.

A loan to a business

"Commercial lending" is what a bank calls business lending. The loan is for a business purpose — stock, plant, premises, tax, a contract, a gap — and the borrower is a company, trust or sole trader. In this sense every loan HomeSec writes is a commercial loan, and the security can be any real estate, including the director's home.

A loan secured by commercial property

The shop, the office, the warehouse, the factory. Here the word describes the security, and it changes the file: commercial property is assessed to 70% rather than 80%, and it is where a bank's process is slowest — valuation, lease review, serviceability — and where ours is not.

Commercial lending, commercial finance, commercial business loans, a commercial mortgage: the same money, described from different angles. What matters is not the phrase but two questions — what is the security, and how does the loan get repaid.

Why commercial lending is slow at a bank, and fast here

A bank's commercial loan runs three to eight weeks, and most of that is not the decision. It is the valuation — a registered valuer, a fee, a week or two — and the financials: two years of accounts, interim figures, an ATO portal print-out, a lease schedule, and a serviceability calculation that treats the last two years as the next two.

HomeSec does not order valuations; we assess the security ourselves. We do not ask for financials; we assess the property and the exit. A Lending Manager reads the file and gives you an indicative answer on the first call. From a clean, complete scenario, funding is as little as 24 hours. That is not a promise to cut corners — it is the removal of the two steps that were never about whether you could repay.

Commercial property we lend against

First or second-ranking mortgage. Cross-collateralisation across multiple properties. Your home can be the security. Almost anywhere in Australia — metro, regional and rural; towns of 3,000 or more people as a guide; smaller populations on merit.

How much you can borrow against commercial property

Take the property's value, multiply by 70%, and subtract whatever stays on title ahead of us. What is left is roughly what is available, between $20,000 and $5,000,000. Where a residential property is added as security, its 80% ceiling applies to it — the two are assessed separately and added together.

Buying commercial property

A purchase is a first mortgage over the property being bought, settled to the vendor's timetable rather than a bank's. Where the contract has a settlement date the bank cannot meet — or where finance was approved and then withdrawn — we can fund the settlement and be refinanced by the bank afterwards, at the bank's pace.

What commercial borrowers use it for

Buying premises

The factory you have rented for a decade comes up for sale, and the bank wants eight weeks. First mortgage over the purchase, settled on the vendor's date.

Fit-out, plant and stock

Equity in the premises or the home, released against a contract, a season or an order. No repayments while the money does its work.

The ATO, before it becomes a director's problem

One loan, paid direct to the ATO, secured by the business's property. The tax debt pages cover the mechanics.

Bridging a sale of premises

The building is under contract; the money is needed before settlement. First or second mortgage, repaid from the proceeds.

Refinancing out of a facility that has been called

A bank that has withdrawn, re-priced or demanded repayment. We pay it out, and the relationship ends on your terms rather than theirs.

Fast and urgent commercial loans

Speed on a commercial file comes from the same place it comes from on any file: the security and the exit are clear, the title is clean, and the documents come back signed. Where a commercial property has an existing lender, the one thing outside our control is how quickly that lender issues a discharge figure or a consent — a day or two for most Australian banks. What makes a file fast and what to do when the date will not move both apply here unchanged.

From the call to the money

What it costs

Priced per file, on the property, the position, the amount and the exit. We do not publish a rate, because a rate with "from" in front of it is the number the best file gets and tells you nothing about yours. Here is how it is priced, and every fee that exists.

And the limitation, stated plainly: a commercial loan solves a timing problem. If the business is losing money on every job, borrowing against the factory does not fix the job. We decline those files, and we would rather say so in the first ten minutes.

Reviewed by Catriona Anderson, General Manager