Commercial Loans Property Finance | Best Interest Rates Australia

The purchase of business premises is included as a purpose for commercial property finance. The property may be the current place of business or a new premises on another site. The premises may be used as the operation of a business in many industry sectors including manufacturing, general offices, retail, medical, warehousing and others.

Yes. Investing in commercial property may be facilitated with this type of funding. Commercial investment properties may include commercial units, warehouses, retail outlets, medical centres, petrol stations, holiday parks, motels, hotels and pubs, commercial and industrial units and other properties used to carry on commercial operations.

Funding is available for the purchase of property for development. It may be for a new development or redevelopment of an existing site. The size and scope of the acquisition and purpose may determine the funding offer. This type of funding is not available through all lenders. Purchasers may seek to engage the assistance of a broker to source appropriate funding solutions.

No. There are a number of differences between funding for residential and commercial properties. One aspect is the security offered by the acquisition. The interest rates on funding will also be different. Commercial funding may take a different structure to residential mortgages. The lenders operating in the commercial sector vary from those in the residential sector.

The interest rate on funding arrangements for the acquisition of commercial properties may be fixed or variable. The choice may be as requested by the lender or the borrower. The size of the loan and the term of the funding may determine the type of rate applied.

The amount of the funding requested in proportion to the purchase price and/or valuation of the property will be subject to lender approval. Funding for the purchase of commercial properties are especially structured and negotiated to suit the specifics of the acquisition. Variations in the amount approved will vary across the lender market. There are lenders that do approve funding for up to 80% for some applicants.

Purchasing a holiday park or caravan park freehold as an investment would be included in the types of properties eligible for funding. The entire property and ongoing business concern may be acquired as the investment and the management and operation of the business leased out.

No. Business owners can seek funding to purchase premises for the operation of their own business. Purchases of premises which will not be the site of the owner’s operations may be acquired with investment property funding. Funding is available for both premises for conducting the business of the funding applicant and for investment purposes.

This area of the lending sector is very specialised and every application handled individually. Lenders enter discussions with purchasers of properties and negotiate an individually structured solution. Funding for large scale properties may require specialist lenders and cover a range of funding options.

The interest rate offered for funding purchases of commercial properties will vary based on a number of aspects. Primarily with this type of finance, the risk level is a major consideration. The credit profile and financial details of the applicant, including the owners and/or directors of the entity applying for finance may be assessed. The kind of property, location and prospects of the entity being conducted at the property would also be considered when an interest rate is offered. Interest rates are also subject to cash rate decisions made by the Reserve Bank of Australia.

Yes. Many buyers will seek to secure funding prior to making an offer on a property. Details of the property will form an integral part of the application assessment process. Funding may be applied for and approval given based on a specific property and specific loan amount. Loans can vary for different properties so approval would need to be sought for a specific property not general approval.

A wide range of properties may be eligible for funding on a commercial basis. These may include premises where ongoing enterprises are operating across many industries. These include factories, warehouses and logistics centres, medical operations, aged care facilities, office premises, retail stores, factories and processing facilities and many others.

Repayments on funding are determined by the type and size of the interest rate, the loan amount and the loan term. Where the interest rate is fixed the repayments would be fixed for the term as agreed. With a variable interest rate arrangement, the repayment amount is subject to change in line with rate variations. Individually structured arrangements may include an option where a flexible line of credit is arranged with varying repayment commitments.

Not all banks and finance companies will offer funding for the purchase of commercial properties. The portfolio selection of individual lenders may be limited to products other than this purpose. Some may offer options for the purchase of the premises of a business but not for new developments. Those seeking this type of funding may consider engaging a specialist broker to source the most suitable lender.

Individuals as opposed to commercial entities may be eligible for funding to purchase commercial properties. This type of purchase may be as an investment rather than as a premises to carry out an enterprise. All applications would be subject to approval by an appropriate lender.

Yes. Funding for the development of commercial properties can be complex. Funding may be required for the purchase of the land only or for the land and the building and works costs to fully develop the site. Lenders will work closely with borrowers to structure an arrangement which best meets the purposes. The solution may include a number of phases and varying lending arrangements over the term.

Purchases made off-the-plan may be subject to lender approval. Considerations may include the timeframe for completion of the site and settlement on the purchase. Specialist lenders may be sought through a broker to provide a solution for this type of funding.

Yes. Office buildings may take different forms of ownership. Ownership of the entire building may be retained by the developer or investor or individual floors or suites may be sold under separate titles. It is quite a common practice for enterprises or investors to purchase an entire floor of an office building. Funding is available for such acquisitions.

The age and condition of a building would form an integral part of the funding application assessment by the lender. The funding options may differ for new or older buildings based on the risk criteria of individual lenders. The purpose of the purchase – an investment or as the premises for the enterprises, may also affect the funding offer.