Why we don't publish a rate — and why the ones you see start with "from"
Look closely at any advertised rate in this market and there is a small word in front of it. From 0.77% per month. That word is doing all the work: it means the number is the best case on somebody's best file, and it is not the rate you are going to get. We would rather not put a number on a website that we already know is not yours.
Any lender doing this properly has to understand you first — who you are, your background, the property you are putting up, and how much you want to borrow. The rate falls out of those four things. Until a person has looked at them, there is no rate to publish, only a number chosen to win the click.
A HomeSec business loan is priced on your file, not from a table. You pay interest on the amount you borrow for the months you hold it, and you are given the figure in writing before you commit to anything.
Private lending is risk-priced, per file
Two businesses can look identical on paper and be priced differently, because the things that move the price are not the things on the front page. Take two applicants borrowing the same amount, on the same term, in the same industry:
- One has financial records up to date; the other does not. Different rate.
- One is offering residential real estate; the other commercial. Different rate.
- One has a clean credit history; the other has defaults. Different rate.
- One has a signed contract of sale as an exit; the other has an intention. Different rate.
A single published number cannot be true across all four, which is exactly why the ones you see carry the word from. It is a starting point on somebody's best file, not a quote, and it changes the moment a real application is assessed. That is what the industry calls a headline rate, and a headline rate is not a price.
What we do instead: you get a real number, in writing, on a Letter of Offer, within about two business hours of the first phone call — before you have paid us anything or committed to anything. That is a price. The thing on a competitor's homepage is not.
- 1. Security type
- Residential · commercial · land
- 2. LVR after our loan
- The lower, the better priced
- 3. Position on title
- 1st mortgage · 2nd · caveat
- 4. Quality of the exit
- Documented beats intended
- 5. Term
- Shorter is cheaper in total
- 6. Records available
- Not required — but they help
- 7. Credit history
- Considered, never disqualifying
Only two of these are about you. Five are about the deal. That is why we can lend to businesses that banks decline, and why we can price a good file sharply.
Caveat loan rates, second mortgage rates, private lender rates — the same question
People ask for the price of these as if they were three products. They are one product, a business loan secured by property, priced on where we sit on the title and what the property is. The ordering below holds on every file we write, and it is the part of pricing we can state without a number.
| Position and security | Where it sits, and why |
|---|---|
| First mortgage over residential property | The sharpest pricing we write. Nobody ranks ahead of us and the security is the easiest to value and to sell. |
| First mortgage over commercial property | A step up. Commercial property takes longer to sell and is assessed to 70% rather than 80%. |
| Second mortgage, residential or commercial | Priced for the position: a first mortgagee stands ahead of us and their balance is the first claim on the property. |
| Caveat, behind an existing mortgage | Fastest to settle, because it needs no consent — and priced for a position with no mortgage registered. The higher the first mortgage, the less equity is left and the higher the price. |
| Vacant land, rural or specialised property | Assessed on merit and priced case by case. Lower LVRs and longer sale periods both push the price up. |
Within each band the same three things move the price: the LVR after our loan, the quality of the exit, and the term. A first mortgage at 50% with a signed contract of sale as the exit is the best file we see. A caveat at 80% behind a large first mortgage, with an exit that is an intention, is the dearest. Most files sit between, and the Letter of Offer says exactly where.
Questions we get on the phone about cost
Why does HomeSec not publish an interest rate?
Is a second mortgage cheaper than a caveat loan?
Is the interest on a business loan tax deductible?
How do I get an actual price?
Every question in that table applies to us too. Call 1300 93 83 87 and ask them. Mon–Fri, 8:30am – 5:30pm Melbourne time.
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.
Priced per file, on the position and the security. These are the positions.
Reviewed by Jason Brockmuller, Joint Chief Executive