Finance Your Business Growth With Strategic Solutions

Commercial loans assess business serviceability and property income rather than personal income. Rates are higher (7-9% vs 6-7%) but fully tax deductible for businesses. Deposits are typically 20-30% vs 5-20% residential. Terms are shorter (15-25 years vs 30 years). Assessment focuses on business financials, lease quality, and property income potential. Commercial valuations are more expensive ($1,500-$5,000 vs $200-$500) and based on income methodology.

Yes, but it’s harder. Most lenders want 2 years trading history. However, specialist lenders will consider: (1) businesses with 12-24 months trading if profitable, (2) franchises with proven models, (3) professional practices with established client bases, (4) businesses with strong pre-sales/contracts. You’ll need: comprehensive business plan, industry experience, larger deposit (30-40%), strong personal financial position, and good explanation of how business will service debt.

Self-Managed Super Fund lending allows your SMSF to borrow money to purchase property (residential or commercial). The loan must be “limited recourse” meaning if SMSF defaults, lender can only claim the property (not other super assets). Typical LVR: 60-80%. Your SMSF needs sufficient cash for deposit (20-40%) plus costs. Rental income goes to SMSF, loan repayments come from SMSF. Strict compliance rules apply. Benefits: build retirement wealth through property, diversify super beyond shares, potential tax advantages within super environment.

Borrowing capacity depends on: (1) Business profit/cash flow – lenders want debt service coverage ratio of 1.25-1.5x (business income covers loan repayments by 25-50%), (2) Property value and LVR – typically lend 70-80% of property value, (3) Business track record – 2+ years profitable trading preferred, (4) Personal guarantees – directors’ personal financial position matters. Rough guide: if business earns $200k EBIT, might support $1M-$1.5M loan depending on rates and terms. Use our calculator for estimate.

Usually yes, especially for: business loans, commercial property with LVR over 70%, new businesses, or loans over $500k. Directors/business owners typically provide unlimited personal guarantees meaning personal assets (including home) can be claimed if business defaults. Some options to minimize: seek lenders with limited guarantee caps, negotiate guarantees limited to business directors only (not spouses), build strong business equity so guarantees less critical, use specialist lenders who rely more on business security than personal guarantees.

Required documents: (1) Business financials – 2 years tax returns, financial statements (P&L, balance sheet, cash flow), GST returns, (2) Business plan – current operations, growth strategy, market analysis, (3) Property details – contract of sale, existing lease agreements, rental history, (4) Company documents – ABN, ACN registration, trust deeds if applicable, company extract, (5) Personal – director ID, personal tax returns, asset/liability statement. Strong applications also include: customer contracts, supplier agreements, industry reports, growth projections, management experience summaries.

Yes! Commercial property offers excellent tax benefits: (1) Loan interest – 100% tax deductible, (2) Depreciation – claim building depreciation (2.5% per year for buildings post-1987) plus fixtures/fittings depreciation, (3) Operating costs – all rates, insurance, maintenance, management fees tax deductible, (4) GST – can claim GST credits on commercial property purchases (not residential), (5) CGT – 50% discount if held 12+ months. Always consult tax advisor but commercial property often provides better tax outcomes than residential investment.

DSCR measures whether business income can cover loan repayments. Calculated: Net Operating Income ÷ Annual Debt Service. Example: Business earns $180k net profit, loan repayments $120k/year = DSCR of 1.5x. Lenders typically want: minimum 1.25x (income 25% higher than debt), prefer 1.5x or better, below 1.0x means negative cash flow (rarely approved). Higher DSCR = easier approval, better rates. Tips to improve: increase business profitability, reduce other debts, seek longer loan terms (lower repayments), consider interest-only periods.

Buy if: (1) established business with stable cash flow, (2) planning to stay 5+ years, (3) want to build business equity, (4) rental costs high relative to ownership costs, (5) property suits long-term needs. Lease if: (1) new/growing business needing flexibility, (2) uncertain about location needs, (3) capital better used for business growth, (4) want to avoid property management, (5) prime locations too expensive to buy. Middle option: SMSF buys property, business leases from own super fund at market rates. Build retirement wealth while business operates.

Timeline varies by deal complexity: Simple deals (strong business, owner-occupied, 30% deposit): 2-3 weeks. Standard deals (established business, good financials): 3-4 weeks. Complex deals (new business, investment property, multiple securities): 4-6 weeks. Development finance: 6-8 weeks. Factors affecting speed: quality of documentation, business complexity, property type, valuation timing, lender workload. We can expedite where possible. Some specialist lenders offer 48-hour approvals for simple equipment finance or working capital.