Buy, refinance or release equity
Secured property loans
Finance to buy the premises you trade from, refinance an existing commercial mortgage, or release equity from a property you already own.
Secured Property Loans at a glance
- Amount
- $50,000 to $10,000,000+
- Term
- 5 to 25 years for a standard commercial mortgage, or 1 to 3 years for a short-term facility
- Security
- A registered first mortgage over the property. A director's guarantee is standard.
- Time to funding
- 4 to 8 weeks from application to settlement. Nobody funds commercial property in hours - the valuation and the legals set the pace.
- Typical use
- Buying your own warehouse, shop or office; refinancing an existing commercial mortgage; releasing equity to fund the business
- What you'll need
- Contract of sale or rates notice, the lease or tenancy schedule, financials, ABN and Australian photo ID
What it is
What is a secured property loan?
Commercial property finance is a mortgage over a non-residential property: a warehouse, a shop, a suite of offices, a childcare site, a pub. Lenders assess it differently from a house. They look at the loan-to-value ratio, at whether you occupy it or lease it out, at the strength and remaining length of the tenancy, and at whether the business can service the repayment if the tenant leaves.
The deposit is bigger than residential. Most commercial deals land between 50% and 70% LVR depending on the property type, which means 30% or more of the price in cash plus stamp duty and costs on top. In exchange the term is long, the rate is well below unsecured lending, and interest-only periods are common at the start. Refinancing and equity release run the same process - if you already own the premises, the equity in it is usually the cheapest capital available to your business.
Worked example
A worked example
- A wholesaler buys the warehouse it has been leasing for $900,000.
- At 65% LVR the lender advances $585,000, so the business puts in $315,000 plus costs.
- Stamp duty, legals, the valuation and lender fees sit on top of the deposit and vary by state. [[NEEDS-MATT: confirm whether we publish state-by-state stamp duty guidance]]
- On principal and interest over 20 years at an indicative 7.5% p.a., the repayment is about $4,713 a month.
- The rent the business was paying on the same building was $4,200 a month, so it is paying roughly $500 more each month and building equity instead of paying a landlord.
Rounded. The valuation, not the contract price, is what the LVR is calculated against - and the two are not always the same number.
Is this right for you?
Is a secured property loan right for you?
Good fit if…
- You have been leasing your premises for years and the rent is dead money.
- You have 30% or more of the purchase price available in cash, plus stamp duty and costs.
- The property has a real second-hand market - metro industrial, a standard shopfront, an office suite.
- You can wait 6 weeks. If your contract has a finance clause, ask for 21 days minimum.
Probably not if…
- You need the money this week. This is not a fast product and anybody telling you otherwise is selling something else.
- Your deposit is thin. Under about 30% you are into specialist lending at specialist pricing.
- The property is highly specialised with one likely buyer - lenders lend against resale, not against your plans for it.
- The business cannot service the repayment without the tenant. Lenders stress-test exactly that scenario.
What it costs
What a secured property loan costs
Commercial property is the cheapest money on this site by rate and the most expensive upfront. Budget for both.
- Interest rate
- Our panel prices business finance between 6% and 20% p.a. Commercial property sits at the bottom of that band. Owner-occupied prices better than investment, and a full-doc file prices better than a low-doc one.
- Establishment fee
- An application or establishment fee is typically charged as a percentage of the loan amount and paid at settlement, plus the valuation fee, which you pay whether the deal proceeds or not. The establishment fee runs 0.5% to 1.5% of the loan amount, and a commercial valuation runs $1,500 to $5,000 depending on the asset.
- Ongoing fees
- An annual line or facility fee is common, plus a review on larger exposures. It runs 0.25% to 0.75% of the facility limit a year.
- Paying it out early
- Variable rate loans usually allow early repayment with little or no penalty. Fixed rate commercial loans carry a break cost that can be substantial if rates have moved. Ask which you are being offered and what the break formula is. On the panel's variable products early repayment is free; on a fixed rate the break cost is the gap between your fixed rate and the lender's current funding cost for the term still to run, applied to the balance.
Bizzloans is a broker, not a lender. The lender that funds your deal pays us a commission, which we disclose to you. You pay us nothing to compare.
Eligibility
Who can apply
- A valid ABN
- Current Australian photo ID
- In business more than 6 months
- Monthly turnover above $6,000
- Bad credit considered
- Demonstrated capacity to service the loan, from trading income or lease income
- A property the lender's valuer can value and a lender can resell
Don’t meet these? Call us — we have lenders for most situations, and we’ll tell you straight if we don’t.
Book a callWhat you'll need
What you’ll need
No documents
To get a quote
- Nothing. The property type, the price or estimated value, the amount you need and your deposit is enough for indicative numbers.
- We will tell you the likely LVR band before you spend a cent on a valuation.
Once you pick a lender
To settle
- Contract of sale, or a council rates notice if you are refinancing
- The lease and tenancy schedule, if the property is tenanted
- Last two years of business financials and tax returns, or bank statements and BAS on a low-doc file
- Your ABN, ASIC company extract and current Australian photo ID for each director and guarantor
- The trust deed, if the property is being bought in a trust
- A valuation, ordered by the lender and paid for by you
How it works
How it works
Week 1
Structure and indicative offer
We work out the LVR the property will support, which lenders have appetite for that asset type, and what the deposit and costs actually add up to. You get indicative terms before you spend money on a valuation.
Weeks 2 to 5
Formal approval and valuation
The application goes to the chosen lender, conditional approval is issued, then the valuation is ordered. The valuer's diary is the usual bottleneck, and the valuation figure - not the contract price - is what the final LVR is calculated on.
Weeks 5 to 8
Legals and settlement
Formal letter of offer, mortgage documents to your solicitor, conditions cleared, settlement booked. Six weeks end to end is a normal run. Four is fast.
This vs the alternative
Commercial mortgage vs borrowing against your home
Plenty of business owners can do either. The cheaper rate is not automatically the better decision.
| Commercial property loan | Business loan secured by your home | |
|---|---|---|
| What is at risk | The commercial property only. | The house you live in. |
| Typical LVR | 50% to 70% depending on the property type. | Up to 80% of the residential value, sometimes higher. |
| Rate | Higher than residential, well below unsecured. | The cheapest rate you will be offered. |
| The catch | Bigger deposit, slower process, tighter valuations. | A bad trading year puts your family home in play. |
We will quote both if both are available. The decision belongs with your partner and your accountant, not with a broker on the phone.
Typical LVRs by property type
| Property type | Typical LVR | What moves it |
|---|---|---|
| Metro industrial and warehouse | Up to 70% | The easiest commercial asset to fund. Good access and standard height help. |
| Office suite or strip retail, metro | Up to 70% | Owner-occupied usually prices and gears better than investment. |
| Retail in a regional town | 50% to 60% | Thinner resale market, so the lender lends less against it. |
| Specialised - childcare, medical, service station, pub | 50% to 65% | Assessed on the operating business as much as the bricks. |
Indicative only. The valuation and the tenant move these numbers more than the category does.
How long settlement really takes
Commercial property is measured in weeks, not hours. Here is the honest timeline so you can set a realistic finance clause.
- Week 1 - application submitted, documents collected, indicative terms issued.
- Weeks 2 to 3 - credit assessment and conditional approval. The valuation is ordered once conditional approval is in.
- Weeks 3 to 5 - the valuer inspects and reports. This is where most deals lose time, and you cannot rush a valuer's diary.
- Weeks 5 to 8 - conditions cleared, formal letter of offer, mortgage documents to your solicitor, settlement booked.
FAQ
Secured Property Loans questions
What LVR can I get on commercial property?
How long does settlement take?
Can I use my SMSF to buy commercial property?
Do I need to occupy the property?
Can I refinance an existing commercial mortgage?
What if the valuation comes in under the contract price?
What is a low-doc commercial property loan?
Who pays for the valuation?
A person reads this, not a scoring engine
A named advisor takes your file to the lenders on the panel that fund your industry and your turnover — and tells you plainly when a secured property loan is the wrong answer and what to use instead.
Ready when you are
Compare Secured Property Loans today
Comparing is free, you’re never locked in, and checking won’t affect your credit score. If we can’t help, we’ll tell you that too.
