Commercial Loans at Home Loan Rates
Commercial loans at home loan rates
Many people who have a commercial loan or business loan would generally be paying a higher interest rate than one would on a home loan. This is particularly the case if the borrower gave the lender a commercial property or business asset as security. You will find this most common with big banks like CBA, NAB, Westpac, or ANZ for example.
What types of lenders lend at home loan rates for commercial purpose?
There are a few different types of lenders who lend at a home loan rate. These include some banks, and non bank lenders. Many would be borrowers are shocked when we explain that some banks offer this type of facility. Most big banks do not offer this. The lenders who lend at home loan for commercial and business purpose do not generally offer or advertise they do this to the public. The reasons for this is they tend to want to offer higher rates. Nonetheless, we know which lenders will offer this facility and can get this for the right customers.
Benefits of getting a commercial loan at home loan rates?
The main benefit of a commercial loan at a home loan rate is the savings in cost. This is mainly a saving in interest rate and fees. Further, by getting a commercial loan at a home loan rate, you will not be subject to an annual review by your lender! Hence you will not need to show your financials to your business banker each year. This will save you tremendous headaches as your business is not dictated to by a lender or banker.
Commercial loan at home loan rates using low doc policy?
It is possible to get a commercial loan at home loan rates using low doc loan policy. Therefore you will not need to show your financials, or income statements. This approach will be saving so much from your standard commercial mortgage as you will save on interest rates, reviews and fees without the need to show your financials!
Commercial loan at home loan interest rates for a commercial or business purpose?
Yes, it is possible to get a commercial loan at home loan rates for a business or commercial purpose. The main condition of this process is that you provide residential security. This policy is possible with a handful of financial institutions up to 90% LVR using residential home loan terms.
For example, with a residential security valued at $850,000, you could refinance all existing commercial priced loans in the business name.
| Interest per annum | ||
|---|---|---|
Commercial Overdraft @ 10.25% |
$250,000 |
$25,625 |
Term loans total @ 6.50% |
$475,000 |
$30,875 |
Leases @ 6% |
$40,000 |
$2,400 |
Total Interest Paid |
$58,900 |
|
Total refinanced at residential rate (2.6%) at 90% LVR |
$765,000 |
$19,890 |
Untied cash flow & interest savings per annum |
$39,010 |
The above example is based on a 15 year loan period. Refinancing at home loan interest rates over a period of 30 years saved the borrower $39,010 per annum making it easy on the borrower’s business cash flow and spreading their liabilities over a 30 year term. On the first 5 year period the borrower would have saved $195,050.
Borrow using residential security for a commercial or business purpose using multiple business and personal names?
Yes, you can break up the borrowing into different names to accommodate your own situation. As an example, if you had a home loan in your personal name, and a commercial loan in your company or trust name and you wanted all the money secured over your residential property, but wanted to keep the loans in separate entity names that would be possible.
In other words, you can have a loan in a personal name and company/trust name and be covered by a cheap residential interest rate without any issues. You will save yourself a lot of money and your accountant will have no problems making your claim at the end of the financial year.
Costs for a commercial loan at home loan rates?
The costs for a commercial loan at a home loan rate can be as low as $0. In many ways there will be no need to even pay for a valuation. All that is required is that you provide residential security!
Commercial loan at home loan interest rates even if I had bad credit?
You can get a commercial loan at home loan interest rates even if you had bad credit. Hence, getting home loan rates for a business or commercial purpose even with bad credit is possible. This comes as a surprise to many would be applicants when we show them this can be done.
Getting a commercial loan with home loan rates is quite easy if the mortgage broker handling has good knowledge of lending policies. Hence, at Mortgage Providers we know which lenders offer home loan rates for commercial and business use without wasting anyone’s time. If you are interested in this product then give us a call and we will explore all your options to help save you thousands of dollars each year.