Our INTEREST ONLY BUSINESS LOANS
1st & 2nd Mortgages
An INTEREST ONLY business loan is the perfect fit for business owners and commercial property investors who want a fast and temporary loan. If they are after a business loan for a longer term than a 1 – 6 month Business Bridging Loan or Caveat Loan, then an Interest Only Business Loan is a logical choice for many reasons.
The main reason is affordability. Rather than having to pay high monthly payments with a conventional business loan, a Business loan keeps your monthly payments to a minimum. The other reason is speed and simplicity. With HomeSec, our Business Loans can be funded in in 24 hours, and we don’t do valuations or require piles of paperwork.
Why are Interest Only business loans more affordable ?
Answer: Because you are only paying the interest each month, rather than having to make much higher payments with a Principal & Interest loan. By only paying the interest each month during the term of the loan, it means you have lower monthly committments. Plus you can pay it all out in one hit when an event happens such as a refinance or the sale of an asset.
Plus our business loans as very easy to get approved. If you have sufficient equity in real estate, you are almost certain to be approved and funded within 24 hours.
At the end of the 12 month term, you can pay the INTEREST ONLY LOAN out (often through the sale of an asset, or refinance). OR you can extend the loan with no additional fees. You simply continue to pay the interest each month.
As it is a business loan, all interest and costs are fully tax deductible.
What is Required?
Get the Lowest Interest Only Business Loan from HomeSec
While applying for a traditional business loan from a bank, the borrower has to provide proof of their business profit , full financial documents along with security documentation to assure the lender they will pay back the loan. However, with an interest-only loan from HomeSec, you will not need anything other than details of the property being used as security and information relating to the existing mortgage. Our experienced and helpful team will assist you in customizing the best business loan type according to your needs.
In business loans with interest-only periods, you only have to pay for the interest amount and not the principal amount. Usually, the repayments for business loans consist of 2 segments.
Principal- It is the initial amount of the loan balance that you borrow
Interest- A balanced percentage to pay, charged by the lender on top of your principal amount balance
While paying for the interest and the principal amount, you can decrease the loan balance in the repayment term. Since we calculate the interest rate on the remaining balance of the business loan, the amount will also decrease with time. However, in interest-only loans in Australia, the principal during the repayment period will not get reduced as the repayment will cover the interest amount only of the business loan amount.
How Long Do the Interest-Only Periods Extend?
With traditional bank funding the borrower can also switch between principal and interest repayment methods anytime during this loan type. But there may be restrictions on the interest-only periods during the loan life. These restrictions are applicable if the borrower applies for an extended or a new request for an interest-only business loan.
When the interest-only time limit expires, the repayment amount will include interest and principal amount like any other loan. The repayment amount will also be more when you start paying off your funds. Thus, you should remain prepared for this change and plan it accordingly. Homesec has options for low-interest-only loans for bad credit for 6 to 12 months.
Benefits of Interest-Only Loans
Business loans with interest-only repayment periods are perfect for small businesses without substantial capital or massive cash flow for smooth operations. Here at HomeSec, we assist you in providing business funding for any business use with our simple interest-only funding. You can have your funding almost immediately with no early repayment fees and competitive interest rates. Besides these, other advantages of low-interest-only business loans include:
Initial Low Repayments
The primary advantage of interest-only loan repayment with traditional lenders is the amount you will repay to us will be much lower than the principal and interest repayments. It will help you as a business owner to solve your financial crunches. You can also use this funding to refinance other debts like credit cards or business loans with much higher-interest rates.
If you are interested in investing money in other businesses, you will get tax benefits from the repayment of low-interest business loans in Australia. You can claim a deduction on the interest rate charged on the principal loan amount.
Having a loan with an interest-only repayment term does not mean you cannot pay the principal during this period. Some traditional lenders allow borrowers to pay additional payments without extra charges. These payments get adjusted against the principal.
Options after the interest-only repayment period get over
You can opt for any of the three options once the interest-only period gets over in low-interest loans for bad credit.
Extending the interest-only repayment period
If your interest-only repayment term is coming to an end and you want to extend it, you can discuss your options with us. At this time, we will assess the borrower’s financial circumstances before approving a new period for interest-only repayment.
Convert to interest and principal repayment
When the interest only period ends with traditional lenders the interest-only loan will automatically get converted into repayment with interest and principal.
Apply for a new business interest-only funding
After the interest-only repayment period gets over, you can apply for a new period. But it will depend on the lender if they will approve it or not.
Reasons to apply to HomeSec for interest-only loans in Australia.
HomeSec explicitly empowers businesses to reach their goals by offering monetary finance to them. We have different types of business loans with interest-only repayment or capitalised business loans that will meet the requirements of the borrower. We are famous among the borrowers as a pioneer lender of competitive low-interest business loans in Australia because:
- The online application process only within minutes
- Funding approval within 24 hours
- Flexible repayment period
- Versatile terms and conditions
- No early repayment charges
So, if you are also interested in taking out a low-interest-only business loan, connect with one of our financial advisors and understand your best alternatives.
What Are These Business Loans?
An INTEREST ONLY business loan is effectively a 1st mortgage loan or a 2nd mortgage business loan. So if you already have a conventional 1st mortgage, our 2nd mortgage sits behind your current 1st Mortgage with your bank.
Unlike a conventional Principal & Interest Loan, the monthly payments on our loans are much lower. The reason is because as you are only paying the interest each month.
HomeSec Interest Only 1st and 2nd mortgages are perfect if you need access to a large sum of money by tomorrow. If you want the funds for a longer term of 12 months or more, they are a better option than caveat loan or bridging loans.
Then you simply pay the interest each month during the term of the loan, and you can pay it out whenever you choose after the initial 12 month term is up. So they are both Fast and Flexible.
Mortgage and Finance Brokers and Accountants (our Partners) across Australia and New Zealand are also the winners. This is because they are becoming increasingly aware of HomeSec’s 1st and 2nd Mortgage Business Loans. As a result, these Partners are actively telling their small business and commercial clients about them.
This is a smart move, because mortgage brokers and accountants need to be able have a solution if a client comes to them urgently needing a large sum of money. Often they can’t get their business clients approved with any of the Cash Flow Lenders. This is due to servicability issues, poor credit score, business type or length of time in business.
None of that worries HomeSec Business Finance. This is why our Interest Only Business Loans are the simple longer term solution for business owners.
If you have sufficient equity in real estate, you are almost certain to be APPROVED and funded within 24 hours.
Frequently Asked Questions
Interest only business loans have a 12 month term and you are required to make interest only payments each month.
Interest only loans can assist with cash flow as the repayment is lower than a principal and interest repayment.
Interest rates start from 1.95% pm.