Commercial Property Loans
Most Trusted Business Lending Specialist in Melbourne
Helping Your Business Find the Perfect Property Loan.
Commercial property loans up to 80% LVR
Competitive interest rates
Simple loan application process
Loan repayments - Principal & Interest or Interest Only
Tailored to your individual business needs
Loan term up to 30 years
Fixed or Variable interest rates
Whatever the property or your needs are, we're here to help.
There are various types of commercial properties you can own, depending on your individual business needs and the financial position. We offer funding solutions for most asset classes through best-practice methodologies to secure the most suitable commercial property loan to suit your needs.
We arrange funding solutions for
Commercial Property Purchase
Land Banking
Medical Clinics
Retirement and Aged Care
Petrol Stations
Commercial Construction & Development
Industrial Property
Warehouses & Self Storage
Student Accommodation
Childcare Centers
Lease Doc Loans
Residual Stock
Offices & Showrooms
Hotels and Pubs
Types of commercial property loans I can apply for
Commercial Property Loans or Commercial Loans: Commercial loans, generally classified as business loans, are secured business banking products that a business owner can use to buy commercial property, equipment or business assets for income generation or, to meet funding needs of other business activities.
Property Development and Construction Loans: These are loans funding the development cost of commercial projects and construction of commercial or residential buildings.
Land Banking & Sub-division Finance: This involves arranging finance to buy large blocks of underdeveloped land and divide them into smaller blocks and offer them to buyers/investors.
Mezzanine Finance. These loans could be helpful if the primary bank funding is insufficient to complete a construction project, and additional funds are needed to complete the project.
Second Mortgages & Caveat Loans: Second mortgages & Caveat loans are a great solution when additional funds are needed for the business but the existing lender is unwilling to provide further finance on the security offered. When the existing mortgage is secured at a competitive rate a Second Mortgage finance would be a cheaper option than refinancing the whole debt to meet the additional borrowing need.
Each lender has its own policy guidelines, loan terms, pricing and interest rates etc. The loan approval is dependent on these factors so it is important to get your loan application fully matched with the lender's credit policy.
What are commercial property loans, and how do they work for my business?
A commercial property loan could be introduced as a business loan that can be the best funding option for a commercial property purchase. Many Business owners are searching to get a commercial property loan for office spaces but are unsure how it works. Most commercial property loans work pretty much in the same way as residential property loans. Getting a home loan for residential property is more popular, accessible, and widely provided by banks and other financial institutions. Accessing a business loan for a commercial property can be a little expensive as they are considered relatively risky, and the experts in this regard are also quite limited. But on the other hand, unlike residential property, the return on investment can be higher for a commercial property with the help of the right financial advisor.
You could obtain a standard business or a commercial loan as a business owner. However, a commercial property loan is explicitly designed to purchase commercial property or for property investment. These loans offer reasonable commercial interest rates. In a higher-risk investment, a commercial property credit provider will be more interested in the rental income generated by the property and the commercial valuation of the property compared to the loan amount being approved. Most lenders will require a detailed valuation for specialized commercial properties.
Commercial properties include property types designed for offices, retail, industrial or warehousing spaces etc. Commercial property loans are perfect for property investors, business owners such as sole traders, partnerships, limited companies, family/discretionary trusts and other parties on behalf of a business or a company. Buying commercial properties like aged care, pubs, hotels or motels can be considered riskier than the standard commercial properties as these properties are tough to sell and difficult to value. Therefore, a commercial property may result in a lower loan to value ratio than a residential property.
In the challenging market of business loans, where loan options and lending criteria are becoming more rigorous, a financial advisor's input has become even more critical. The loan contract and crucial details like commercial property interest rates, loan repayments, lending policies, and loan terms for commercial property loans are often negotiable. They depend on the type of business that requires the loan, the type of commercial property bought, and its location.
The right financial help is crucial in the business world today. At Aus Wealth, we have built close relationships with major banks and non-major lenders to benefit all our clients.
Lending Specialists at Aus Wealth have a thorough knowledge of the local property market and the best commercial lending options for you.
We offer flexible financial solutions with tailored terms for professional property investors, startup businesses and all types of small & medium businesses for buying commercial property or refinancing. We work closely with you to offer the best funding solutions that fit your individual needs and investment plans and goals, whether you are a professional investor with a property portfolio or a small business owner just with your premises.
How commercial property lending differs from residential lending?
Lenders recognize commercial property loans as riskier than home loans due to the higher and extensive vacancy rates, and it is less familiar to many people than a residential property. The decision to invest in a residential property or a commercial property is the investor's choice depending on their financial situation, goals, and willingness to take on this higher risk of investment. The differences between commercial property lending and home loans are.
Interest rates: You can generally presume to pay higher interest for a commercial property because the lender's risk is more elevated.
Loan to value ratio (LVR): You would be able to borrow up to 95% of the value for a residential property. But for commercial loans, lenders usually offer around 80% of the property value or the purchase price. Therefore, you might need to show your business assets or offer a larger deposit to qualify for the loan.
Fees & Charges : There can be other fees and charges added to the cost of the loan, such as establishment and ongoing fees. This can also include valuation fees . The costs such as redraw fees or early repayment fees, and cost savings like fee waivers, may not be included in the loan rate but may influence the cost of the loan.
However, in both cases, the lender will assess the applicants to ensure that they have sufficient income or means to service the loan and assess the type of security offered. We provide professional advice for you to submit a successful loan application.
Pros
Loan amounts: You have access to considerable loan amounts based on the individual risk profile and the type of security offered.
Higher rental returns: You could compensate for the generally higher risk of commercial properties with this.
Flexible repayment options: Could be in line with your business cashflows with loan products like interest-only repayments.
Lender Flexibility: There is not much compliance requirements to cover the assessment of commercial loans. Therefore, the lenders have more flexibility and freedom with these business loans and lending policies. However, the lender will provide a relevant product disclosure statement containing all information on loan features, fees & charges, risks & benefits etc.
Cons
Rigorous lending criteria: You'll have to meet specific lender requirements to be eligible for a commercial loan. This could be providing full financial statements and trading history of the business or a Lease-doc with income details or a Low-doc loan with accountants' letter etc.
Slow growth of property values: There could be uncontrollable factors that may significantly impact the value of a commercial property and the rent you could potentially charge the tenant of a rental property. Or the commercial property prices can rapidly drop in a pandemic situation depending its type, location etc.
Expensive than residential property: Interest rates applicable may be slightly higher for commercial properties. You might have to pay GST on the purchase price, unlike on residential property.
