Sometimes businesses need funds fast, and traditional loans often have long approval times and onerous requirements to meet. Whether to invest in working capital, upgrade premises or facilities, purchase equipment or buy property, a second mortgage loan (or Caveat Loan) can provide money in less than a week from application to released funds.
A second mortgage loan is quick and easy to apply for and only requires the borrower to be a Pty Ltd Company and own property (residential, commercial, vacant land and located anywhere in Australia). Unlike traditional loans or mortgages, there are no credit checks, in most cases, or financials required, making them a preferable option to banks if you need money for your business quickly. They are ideal for companies trying to meet unexpected growth demands or which require a financial boost to close an investment opportunity.
Businesses can borrow up 70 (or up to 80% in some cases) of the value of a property (between $50,000-$50m) and have 1-24 months to repay the loan, at a manageable interest rate, which makes them an attractive solution for companies looking to invest in their business without delay.
For the term of the loan, there is a caveat on the borrower’s property, but it is immediately lifted on the settlement of the loan, with no ongoing restrictions on the borrower utilising the property as collateral again (straight away if required). Many borrowers find that by using their property as collateral, they can borrow more money through a second mortgage loan than via traditional channels because lenders are more confident with the added security of property.
Once the loan is secured, borrowers can get on with the business improvements or investments they had planned (and specified on applying for the loan). With no repayments due until the loan term is finalised, it provides much-needed cash flow to realise their ambitions.
However, businesses must have a clear repayment plan or exit strategy because once the loan term expires, they need to pay the total amount plus interest back in a single lump sum. Loan terms can be from 1-24 months, and before considering a second mortgage loan, businesses need to go in with their eyes wide open and a watertight strategy to ensure they can settle the loan in full at the conclusion of the agreed term.
Some exit strategies businesses might employ are to refinance existing mortgages, secure alternative finance, or sell property to release funds.
In some instances, businesses may require the loan to purchase stock or goods, with the sale of those goods being used to pay back the second mortgage loan. A business may be awaiting funds from the partial sale of the company or be awaiting the bank to release funds, however in each scenario given, there’s an obvious expectation of a lump sum large enough to cover the repayment of the second mortgage loan.
The exit strategy is critical to reducing risk to the borrower, making second mortgages a viable quick way to invest in, or grow, your business. What’s more, given there is no credit check to impact your credit rating, you can get another second mortgage loan as soon as another business investment opportunity arises (after you have paid back the first of course.)
Many mortgage brokers and accountants are not aware of second mortgage loans as short term solutions to offer business customers, especially for significant amounts of money. When borrowers have a clear business plan and exit strategy, second mortgage loans can be an excellent way to grow a business.
By
August 16, 2022
1 min readShare
As a business owner, you’ll know that there are times when you need quick access to cash. Caveat loans are a unique financing option designed to do exactly that. While they can be a valuable resource for bridging financial gaps, it's essential to understand both the benefits and considerations of caveat loans before deciding whether […]
Managing tax obligations effectively is crucial for keeping your business’s finances stable. When these obligations lead to debt accumulation with the Australian Taxation Office (ATO), it's essential to consider financial solutions like ATO debt consolidation. This approach helps to simplify financial management and also enables long-term security for your business. Let’s look at how to […]
Looking for ways to access significant capital for expansion, equipment purchases, or managing cash flow? Secured business loans are a powerful tool for businesses that need exactly this. These loans are backed by collateral – usually in the form of business or personal assets – providing lenders with a security net. While secured loans often […]
In today's evolving financial landscape, businesses are increasingly looking beyond traditional banking institutions to fulfil their funding needs. Non-bank loans are a compelling alternative, offering a spectrum of financing solutions that cater to multiple business requirements. This guide navigates non-bank lending, highlighting the types of loans available and their unique advantages to businesses seeking flexible […]
A second mortgage is a powerful option in homeowners' financial toolkit that often remains underused. This comprehensive guide will explore how second mortgages work and when they can be a wise financial move. Whether you want to finance a major project or consolidate debt, understanding second mortgages can open new doors. What Is a Second […]
Navigating the world of business financing can often feel like a maze, especially when urgent financial needs arise. Traditional loan processes might not always align with the speed of business operations, leaving entrepreneurs seeking faster alternatives. Here’s where caveat loans come into play—a swift solution tailored for immediate business financial requirements. This blog unfolds the […]
When it's time to fuel your business’s growth, securing the right financing is crucial. Among the myriad options available, secured business loans stand out for their numerous benefits, especially compared to unsecured loans. Let's evaluate what makes secured loans preferable for many businesses, focusing on key advantages like potentially lower interest rates and higher borrowing […]
Entering the world of property development is an exciting journey filled with potential rewards. With the right financial backing, turning visionary projects into tangible realities becomes possible. However, securing financing can often seem like a hurdle. This guide illustrates the process of obtaining a property development loan, providing actionable advice to strengthen your application and […]
Navigating the path to securing a business loan can seem daunting, especially with bad credit hanging over your head. However, the financial landscape is changing, offering more avenues for business owners to secure the funding they need, regardless of their credit history. This blog sheds light on alternative lending options with reliable loan companies, such […]
Finding yourself in a situation where you owe money to the Australian Taxation Office (ATO) can be stressful for any business owner. Yet, it's a reality that many face. ATO debt doesn't have to spell the end of your dreams and ambitions, thanks to ATO debt loans. These loans offer a financial breather, enabling you […]
In our latest case study, we spotlight a Financial Advisory business in Neutral Bay, Sydney, faced with the challenge of exiting a constraining loan. Traditional lending avenues had proven ineffective for the stockbroker-turned-director in need of $1.5M for his residence. Simply Funds crafted a bespoke solution, leveraging multiple lenders to structure a combined first and […]
Our case study showcases an Accounting Firm from the Northern Beaches of Sydney, grappling with a high-interest loan in default. The firm's director, needed a lifeline to not just save his residential property in Elenora Heights but also to secure additional capital for business growth. Traditional lenders were not an option. Simply Funds stepped in, […]
In this detailed case study, we delve into how Simply Funds provided a lifeline for a Panel Beater business in Carringbah, Sydney. Faced with excessive monthly payments on loans for two residential properties, the director sought a solution to ease cash flow and steer his business back towards stability. Traditional financing routes were not an […]
Seeking financing for your business? Partnering with business loans brokers could be the key to unlocking a world of opportunities. In this blog post, we’ll explore the role of business loans brokers, the advantages of using one, and how to choose the right broker for your needs. Let’s dive in! Key Takeaways Understanding Business Loan […]
Are you an entrepreneur or business owner seeking funding for your venture? Navigating the world of business financing can be daunting. But worry not - this comprehensive guide will help you secure the funds you need to grow and succeed. We’ll cover a variety of financing solutions, tips for assessing your financial needs, and strategies […]
The process of obtaining a loan secured by property can be overwhelming, and it's no surprise that many people get confused about the different types of mortgages available. Three common terms that often get mixed up are caveat, first mortgage, and second mortgage. In this article, we'll explore the differences between these types of mortgages […]
What will 2023 bring for the Australian Economy? Interest rates are expected to rise further, home prices are predicted to continue falling, and the demand for refinancing is projected to increase, especially with the looming cliff of fixed-rate mortgages ending. But what does this mean for brokers, borrowers, businesses and property owners? Here's a look […]
Running a business means there’s lots on your plate. Everyday is a new obstacle, task or problem that you need to source a solution for. When it comes to funding your business and sourcing finance, we’ve made finding a solution easy for you. This article outlines the four types of loans you should know about. […]
When seeking funding in the form of a loan, it is important to understand a range of key concepts that apply to lender assessed financial products.
Challenges are a daily occurrence in the world of business. More often than not, business owners mistakenly view these challenges as an obstacle rather than an opportunity.
When it comes to short term business finance, one of the most difficult tasks faced by business owners is finding the product that will best suit their needs.
If you require additional cash flow for your business or other personal reasons, using the equity in your property may be a viable option. Contrary to the thoughts of many, you can use personal real estate which has an existing mortgage as security for a loan provided there is equity available.
The world of business continues to evolve, and the lending space is no exception. There is an increasing demand for secured loans which has brought about changes in many areas.
Whether to invest in working capital, upgrade premises or facilities, purchase equipment or buy property, a second mortgage loan (or Caveat Loan) can provide money in less than a week from application to released funds.
Getting a business loan with major financial institutions such as banks can take weeks, or even months. Simply Funds has this problem by providing fast loans for business.
Securing funding through traditional lenders such as banks can be a lengthy and rather complicated process.
A low credit score is not the end of the road
Throughout the course of running a business owners are faced with difficult decisions and constant challenges. Among those are decisions relating to cash flow management, and more specifically, business finance.
Caveat loans (https://simplyfunds.com.au/blog/fast-caveat-loans/) are a financial solution for businesses, particularly useful for start-ups and commercial property investors. A caveat loan is a fast funding loan that is secured against a property. I
We’ll assess your application fast and get you an answer (and the funds you need) quickly.
Simply select the amount you're looking to borrow, click on the button below and fill out the
form. Our friendly team will respond to your enquiry as soon as possible.
A Bizcap provides both Unsecured and Secured loans to Small Business Owners. When assessing a loan application Bizcap generally doesn't take into consideration if a prospective customer has specific assets to provide as security. However:
(a) if the loan amount is above $30,000 (or any other figure which Bizcap determines from time to time), Bizcap will, under the loan agreement take a charge. For a corporate borrower and any corporate guarantor, the charge is over all of that entity's present and after-acquired property (that is. the security is not over specific assets but any and all assets which the entity may have). For a sole trader borrower and any individual guarantor, the charge is over its current and future real property; and
(b) in certain instances, for example, where the loan relative to the cash flow of the borrower is of a size that warrants the provision of security over specific assets. Bizcap may require specific security to be granted over those assets. Bizcop may register its security interest(s) under relevant legislation, including the Personal Properties Securities Register and the register held under the Real Property Act 1900 (NSW) or Its equivalent.
I n addition. Bizcap may take personal guarantees from directors of corporate borrowers, directors of corporate guarantors and certain individuals. No registrations are made in respect of guarantees.
Simply Funds operates an online information service that seeks to introduce Australian businesses to potential funders. Simply Funds does not provide any credit, financial products, or financial advice – either to individuals or businesses.
© 2024 Simply Funds. Web development by Dimo .
