Commercial Property Loan
How To Source And Structure The Right Commercial Property Loan That Provides Up To 80% of the Property Value – Without The Hassles and Risks Of Yearly Reviews…
So you can stop paying rent, and potentially save thousands in interest and fees
Access to more lenders to get you the right finance for your situation, fast
Loans are structured to protect you, your credit rating
Specialists in helping business owners with unconventional lending circumstances
Complete done-for-you service (including paperwork)
Want To Stop Paying Rent And Get Your Own Commercial Property, But Have Some Of These Common Concerns?
Like many self-employed business owners considering a commercial property loan, are you…
Unsure if a commercial property is within your reach… and want expert, advice so you know how much you may be able to borrow and what the repayments would look like?
Concerned your local bank or broker may not have the product options (or expertise) to help you structure your loan for maximum borrowing capacity, and flexibility?
Too busy to compare dozens of loans from multiple lenders… and wish you had a trustworthy expert to do all the legwork for you?
Worried about getting declined (and having your credit rating damaged) or making other expensive mistakes that could needlessly cost you thousands and leave your business and assets exposed?
And like most business owners, do you want to know how to source and structure the right commercial property loan, so you can stop paying rent, and potentially save thousands in interest and fees.
Many self-employed business owners have these same questions and concerns. That’s why we developed a no-obligation, Complimentary Consultation where you can get the information you need to help you get the right commercial property loan for your business.
Commercial Property Loans
If you’re thinking of venturing into the commercial property market as a business owner or investor, here are several finance options that you may find suitable depending on your individual situation.
Commercial property loans provide flexible funding solutions for business owners and investors looking to purchase or refinance commercial real estate. In this guide, we will delve into the different loan types, their terms, eligibility criteria, acceptable security types, and more.
Commercial Property Loan Types
Commercial property loans come in different variations to cater to the diverse needs of business owners and other borrowers. Let’s take a closer look at the most common types of commercial property loans:
- Full Documentation Loans
Ideally if you can provide full business financials, such as two years business financial statements along with two years tax returns, then you may be eligible for a full documentation loan.
Interest rates for full documentation loans are usually much more competitive when you compare them with Alternative Document loans.
Full documentation loans usually offer flexible repayment options, including principal and interest or interest-only payments. Fees and charges will vary depending on which lender, loan term and property type.
It’s best to speak to a professional to get details on your individual situation.
- Alternative or Low Documentation Loans
Alternative documentation loans, also known as low doc loans, are designed for borrowers who may not have all the necessary financial documentation which is typically required for a full documentation loan.
These loans offer an alternative application process, requiring less paperwork and documentation to verify your business income. They are ideal for self-employed individuals or small business owners who have difficulty providing traditional financial statements.
- Lease Documentation Loans
Lease documentation loans, also referred to as lease doc loans, cater to investors seeking a simplified assessment process for investment purposes.
These loans are secured by the lease agreements of the property rather than traditional financial documentation. They could be a viable option for borrowers who generate income from lease agreements.
Loan Terms and Annual Reviews
Commercial property loans offer flexible loan terms tailored to meet the specific needs of borrowers. The typical loan terms range from 15 to 30 years, providing borrowers with the freedom to choose a repayment period that aligns with their financial goals.
Annual Reviews:
Annual reviews are frequently required for commercial property loans, as opposed to most residential mortgages. If your business experiences a year with lower income because of various reasons, this could have a negative impact.
No Annual Review:
On the other hand, there are some lenders that don’t require an annual review, which means that once the loan is approved and the terms are set, borrowers can enjoy a “set and forget” approach without the hassle of an annual review, and you won’t need to provide updated financial statements each year.
Acceptable Security Types
Commercial property loans are primarily secured by the commercial property itself. However, in certain cases, residential properties can also be accepted as security. The acceptable security types for commercial property loans include:
- Commercial properties, such as offices, industrial properties (warehouses and workshops), and retail properties (shops).
- Residential properties, depending on the zoning and use of the property.
It’s important to note that the acceptability of security properties may vary from lender to lender. Before proceeding with a commercial property purchase, it is advisable to consult with a finance specialist to determine the acceptable security types for your specific commercial property loan requirements.
Eligibility Criteria
To be eligible for a commercial property loan, borrowers must meet certain criteria. The eligibility criteria may vary slightly depending on the lender, but generally include the following:
- Natural persons: Permanent residents or citizens of Australia living and working in Australia.
- Sole traders and partnerships.
- Companies and trusts: In most cases, if a company intends to borrow money, it is required to be incorporated and domiciled in Australia. Additionally, many lenders may request that the directors of the business act as guarantors for the loan.
It is important to note that these are general eligibility criteria, and specific lenders may have additional requirements. It is advisable to consult with a finance specialist to determine your eligibility for a commercial property loan.
Loan Amount and Loan-to-Value Ratio (LVR)
The loan amount and loan-to-value ratio (LVR) are important considerations when applying for a commercial property loan. The loan amount refers to the total amount of money you are seeking to borrow, while the LVR represents the percentage of the property value that the lender is willing to finance.
The maximum loan amount and LVR can vary based on factors such as the location of the property and the lender’s specific policies. As a general guideline, the LVR can range up to 70% and some lenders will allow up to 80% LVR for certain properties.
It’s important to note that a higher loan amount may require a larger deposit to complete the purchase. The deposit amount will depend on the loan amount, property type, and the lender’s specific requirements.
By consulting with a finance specialist, you can determine if your particular scenario will work based on your individual goals, needs, and objectives, which will be helpful in making informed decisions.
Cash-Out and Equity Release Options
Commercial property loans often provide borrowers with the option for cash-out or equity release. Cash-out refers to the ability to access the equity built up in the property for business or investment purposes. This can provide additional funds for business expansion, renovations, or other investment opportunities.
However, it’s important to note that cash-out options are typically not available for working capital purposes. Lenders may have restrictions on how the cash-out funds can be used. This varies from lender to lender, so it’s best to speak with us about your scenario before moving forward.
Interest-Only Options
Interest-only options are available for commercial property loans, providing borrowers with flexibility in their repayment structure. These options allow borrowers to make interest-only payments for a specific period, typically up to five years. However, it’s important to note that for some lenders, the interest-only period may be shorter if the LVR exceeds 70%.
Interest-only options can be beneficial for borrowers who want to manage their cash flow or have specific investment strategies in place. Consulting with a finance specialist will help you understand the interest-only options available and determine the best approach for your financial goals.
Loan Purposes and Property Use
Commercial property loans can be used for various purposes, including:
- Property purchase: Commercial property loans can be used to finance the purchase of commercial properties, allowing business owners and investors to acquire the space they need for their operations or investment portfolio.
- Refinance: Borrowers can use commercial property loans to refinance existing loans, potentially taking advantage of better interest rates or more favorable loan terms.
- Property improvement: Loans can also be used to fund renovations, expansions, or other improvements to existing commercial properties.
Commercial property loans are suitable for property owner-operators and investors alike. Whether you are looking to purchase a property for your business or expand your investment portfolio, a commercial property loan can provide the necessary funding.
Annual Reviews and Security Property Requirements
As mentioned earlier, annual reviews are not always required for commercial property loans. However, in some cases, lenders may conduct valuations every three years as part of the loan agreement. The cost of these valuations can vary and may be borne by the lender or the borrower, depending on the specific terms of the loan.
Acceptable security properties for commercial loans can include a wide range of properties, including offices, industrial properties, retail properties, and even certain residential properties. However, it is important to note that the acceptability of security properties may vary from lender to lender. Consulting with a finance specialist will help you navigate the requirements and select the most suitable lender for your needs.
Conclusion
Commercial property loans offer flexible and tailored financing solutions for business owners and investors. Whether you’re looking to purchase a commercial property or refinance an existing loan, understanding the various loan types, eligibility criteria, loan terms, and security requirements is essential.
By consulting with a finance specialist and exploring the options available, you can secure the funding needed to grow your business or investment portfolio. With competitive interest rates, flexible repayment options, and the ability to access equity for business purposes, commercial property loans can be a valuable tool in achieving your financial goals.
Remember to conduct thorough research, compare different lenders, and seek expert advice to ensure you make informed decisions that align with your specific needs and objectives. With the right commercial property loan, you can take the next steps towards success in the commercial property market.
How We Help Business Owners Get The Right Commercial Property Loan For Your Situation
Over the past 13 years we’ve helped hundreds of self-employed business owners get commercial property loans for up to 80% of the property value, with better interest rates, lower fees, and more flexible conditions.
The Right Loan For Your Situation
Unlike other banks and brokers that most commonly cater for wage earners (not business owners), and are restricted to selling their own or brand-approved lending products (whether they are right for you or not), we specialise in working with business owners and have access to hundreds of loan options from dozens of lenders to ensure you get the right loan for your situation.
We Help You Structure Your Loan
While other banks and brokers merely find you a loan, we look at your whole financial situation and help you structure your loans in order to set you up for the future.
We Even Do The Paperwork
Once we find the right home loan, we pre-fill all the forms to save you time and maximise your approval success. And we review everything each year to ensure you’ve always got the right finance option.
Testimonials
Other Self-Employed Business Owners and Individuals We’ve Helped
If you’ve ever tried to get a loan from your bank, you’ll know how hard (and often disappointing) it can be. But it doesn’t have to be that way. Take a look at what some of our clients say about how we helped them get finance for their home, investments, and business:
The team at Pro Options has more than 48 years of combined experience helping self-employed business owners and other indiviuals get fast approval for better finance. Here’s what some of them say about their results and experience with our team:
A Huge Thank You To Alex From Our Mortgage Options!!
A huge thank-you to Alex from Our Mortgage Options!! I came across Alex about 18 months ago when my partner and I were trying to get into the housing market as first home buyers. Thank god we found Alex and had him on board to help us with our journey. He guided us all the way from getting our pre approval to buy our land and house making everything so easy and stress free. He found us a great loan and bank, explaining everything we needed to know in plain english. He managed everything related to our bank including progress payments and inspections with his communications always prompt causing no delays. Thank-you Alex for helping us to get our first home:)
I have been working with Alex for 12 years and he has been wonderful to deal with, his knowledge and client focus have saved me thousands of dollars. Highly recommended!
Alex and his team are top notch brokers and always goes beyond the call of duty to help clients, I would recommend his service to anyone needing finance.
My Investment Refinance Journey Paid Huge Dividends!!
“As an experienced investor who has required finance for property purchases whether they be for land, units, houses or for construction both in NSW or interstate, I’m always after a better deal. Ultimately the better the deal, the more dollars I can drive back into further investments to achieve my financial freedom dreams and fund my lifestyle that includes a comfortable family home, private school fees for my children, numerous overseas trips, and stepping ever closer to leaving the rat race behind. Recently in this strange Covid-19 world, Alex at Our Mortgage Options managed to refinance my exisiting mortgages and secure me additional construction loan finance that has now paid off handsomely. I’m basically at minimum now $500 a month (or $6000 a year) better off with reduced interest rate payments meaning that the next project after this new property is built, is not that far away. The refinance journey due to financial institution compliance can sometimes be excruciatingly long and frustrating but with Alex in your corner, well worth it!!”
Alex was extremely helpful throughout our 1st home purchase. He made the process smooth and hassle free. He is well versed in his field and we would recommend his professionalism to anyone who is needing the guidance that he offered in serving us.
Great mortgage brokers. These guys will give you great advice in terms of the best home loan product. Speak to these guys before going to your bank. You won't regret it.
8 Ways We Help Business Owners
Get Better Commercial Finance
Comparing banks and mortgage brokers can be confusing (and time-consuming). But it’s a critical exercise because choosing the right lender can save you thousands in interest and fees, and get you more money, faster. While the wrong lender could…
- Jeopardise your dream property with long delays
- Cause you to needlessly overpay in interest and fees
- Expose your current assets to unnecessary risk
- And damage your credit rating and future finance opportunities
Here are some of the things we do differently to help you avoid these disaster scenarios and get the right commercial property loan — fast
Specialists In Small Business and Unique Lending Situations
Business owners who fall outside the rigid lending criteria of banks can find it difficult to get finance. We specialise in helping people who have unique situations including self-employed business owners and those who may have been knocked back for finance in the past.
Potentially Save Thousands With More Lending Options
While most banks and brokers are limited by their in-house or brand-approved loans (whether they are right for you or not), we analyse dozens of loan options from our vast network of lenders to help you potentially save thousands in interest and fees.
Holistic Advice To Help Maximise Borrowing Capacity
Our holistic approach considers your entire financial structure (not just your loan) to help maximise your borrowing capacity, and protect your credit rating.
Solely Serving You And Your Interests
Large lenders are naturally accountable to shareholders and corporate interests (and recommend loans accordingly). We serve you and your best interests alone.
Qualifications And Experience
Unlike a mortgage broker, who has to undertake a Diploma of Mortgage Management by law, did you know bank staff (while they may be required to undertake inhouse training) do not need to be formally qualified in finance?
Make no mistake, our team members have the formal qualifications, experience, and ongoing professional development to help business owners achieve their financial outcomes.
Regular Reviews Ensure You Always Have The Right Loan for Your Situation
When did your bank last call to tell you they could give you a better deal on your loans or savings accounts? We will proactively analyse your loan at least once a year (more often if interest rates change) to make sure you’ve always got a loan which stacks the cards in your favour.
Complete Done For You Service
We compare dozens of loans, negotiate the rate with lenders, prepare and package your application for fast approval, and manage the whole process to ensure no mistakes are made. And it won’t cost you a single cent.
Free Advice Specific To Your Situation
Whether you’re looking for a new home or business loan, trying to save on your existing loans, consolidating multiple loans, or simply want advice for the future, we invite you for a complimentary consultation where we will share our advice stemming from over 48 combined years of experience.
Our Six ‘A’ System To Help You
Get The Right Finance -- Fast
ACQUAINTANCE:
We take time to understand your needs and financial situation so we can source and structure the right loan to save you interest & fees while protecting your assets
ANALYSIS:
We compare loans from dozens of lenders and negotiate rates, fees, and conditions on your behalf – all at no cost
ALTERNATIVES:
We present you with several options, explain all the details, and give you our professional recommendation
APPLICATION:
We pre-fill and package your application (saving you hours of admin) for maximum approval success
APPROVAL:
We follow up to ensure everything goes smoothly (with no mistakes) right through to settlement day
ACTIVE CARE:
We regularly review everything to ensure you can be confident you have the right loan for your situation.
Your Next Step To Get The Right Commercial Property Loan For Your Business
The quickest and easiest way to see how to get the right commercial property loan is with a no-obligation Complimentary Consultation during which:
- You’ll get a firm idea of how much you can borrow and what it will cost in terms of interest, fees, and repayments (so you can confidently start looking at properties)
- You’ll learn how to avoid common mistakes that can lead to failed applications and corresponding credit damage (and things you need to do now to ensure your loan application is successful)
- You’ll get an overview of the different types of finance structures (and what loans are likely to achieve your desired result in terms of the interest, fees and flexibility you’re looking for)
- You’ll explore ways our team can help you structure the right commercial property loan, so you can stop paying rent, and potentially save thousands in interest and fees.
Please be assured this consultation is not a sales presentation in disguise. On the contrary, you will receive expert advice specific to your situation.
Naturally, we’d love to help you arrange your finance, but you can certainly take our advice and try to implement it yourself. In any case, you have nothing to lose with a no-obligation complimentary consultation.
