Need funding now, but not sure for how long?
What to do when an opportunity needs funding now but nobody can say how long the money will be needed: an open-term, property-secured business loan, kept for a month, a year or longer, and repaid when the exit arrives.
- Opportunities rarely arrive with a known end date. A fixed-term loan makes you guess one, and charges you if you guess wrong.
- A HomeSec loan has an open term: no minimum term, no maximum term and no fee to extend.
- Keep it for a month, a year or longer, and repay it early with no penalty the day your exit arrives.
The question the video asks
The right business opportunity often turns up when you least expect it: stock at a price that will not last, a contract that needs equipment now, a competitor's business for sale. You may know you need the money this week without knowing whether you will need it for a month or a year. Most loans make you choose. This one does not.
Fixed term against open term
- A fixed term makes you name an end date on day one. Repay early and a minimum interest period or an early repayment fee often applies; run late and there is a fee to extend.
- An open term has no end date to guess. There is no minimum term, no maximum term, no fee to extend and no penalty for repaying early.
The difference only shows up when plans change, which is exactly when it matters. A sale that settles a month late or a payment that arrives early costs nothing extra on an open term.
What still has to be true
An open term is not an open-ended problem. The loan is secured on equity in real estate and needs a realistic exit: a sale, a payment on its way, or a refinance. The exit strategy video explains each one. Interest can be capitalised for up to 6 months, so there are no scheduled repayments while the opportunity starts to pay.
Read the transcript
Sometimes the right business opportunity comes along when you least expect it. But what if you need the funding now and you don't know exactly how long you'll need it for? With flexible funding from HomeSec, you can choose what works for your business, whether you need it for a month, a year, or longer, subject to your loan terms. To learn more about how HomeSec can help you, simply call 1300 938387 or head to www.homesec.com.au.
Transcribed from the recording's own captions, with music cues removed.
Questions people ask next
What is the difference between a fixed term and an open term?
Is there a minimum period I have to keep the loan?
Can I really keep it as long as I like?
The video is the short version. The written guide has the detail: fixed term against open term, in full.
To talk it through about your own property, ring a Lending Manager on 1300 93 83 87, Mon–Fri, 8:30am – 5:30pm Melbourne time.
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Reviewed by Jason Brockmuller, Joint Chief Executive