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Fixed Rate Business Loan

People usually opt for a fixed rate business loan to remain in a competitive interest rate for as long as they can.

Business loan interest rates are negotiated with regard to different situations. As such, it can be difficult to qualify for a competitive rate sometimes.

By locking in your rates, you can enjoy the security of a fixed payment, especially if you qualify for a competitive interest rate, until the fixed term ends.


Fixed rate business loan rates

Residentially secured business loan rates

Loan Category Interest Rate Contact Us
1 year fixed 4.29% Apply
2 years fixed 4.19% Apply
3 years fixed 3.75% Apply
5 years fixed 3.99% Apply

Some lenders can offer lower business loan interest rates if you’re securing your mortgage with a residential property.

Commercially secured loans

Loan Category Interest Rate Contact Us
1 year fixed 4.60% Apply
2 years fixed 4.51% Apply
3 years fixed 4.37% Apply
5 years fixed 4.80% Apply

SMSF business loans

Loan Category Interest Rate Contact Us
1 year fixed 4.60% Apply
2 years fixed 4.51% Apply
3 years fixed 4.37% Apply
5 years fixed 4.80% Apply

It’s recommended that you speak with a mortgage broker before accepting your bank quote, since there’s not much consistency in SMSF business loan interest rates.


What is a fixed rate business loan?

Generally, borrowers can lock in their business loan interest rates for up to five years. Some lenders can even consider a longer term if you have a strong application.

Fixing your rates means that your interest rates won’t change during the fixed rate term, even if the interest rates in the market fluctuate in the future.

For example, if you have a loan for $700,000 and you fix your loan at 4.75% for 5 years then your monthly fixed repayments will be $1,565. This means that you’ll only need to pay $1,565 on your loan regardless of any changes in the market.

Business loan interest rates depend on a lot of things, such as the amount that you’re looking to borrow, and the strength of your application.

How much can I borrow?

Generally, your borrowing power depends on the lender you’re applying with, the loan product and how they assess your application.

Typically, with a business loan, you can borrow from $250,000 to anywhere up to $50,000,000. Please note that loans over $5 million are assessed more strictly.

A fixed rate business loan provides you with the security of fixed repayments and protects you from the risk of an interest rate rise.

Call us on 1300 889 743 or complete our free online assessment form to speak with our mortgage brokers who are credit specialists. They can help you find the right mortgage that meets your financial needs and a competitive interest rate.

How long is the fixed term?

The fixed term on a fixed rate business loan is usually one to five years long. During this period, the interest rate on the business loan doesn’t change, even if the Reserve Bank of Australia’s (RBA) cash rate fluctuates.

After the fixed term ends, the loan reverts back to a variable interest rate.

Can I extend the fixed term?

Some lenders can extend the length of the fixed rate term up to another five years. However, this depends on your situation and your repayment history during the previous fixed rate period.

What features can I get?

A fixed rate business loan offers almost all home loan features. After assessing your loan needs, you can consider business loan features, such as:

  • Overdraft facility: Most lenders allow you to have an overdraft facility as long as you have an acceptable property as security. Your credit score will also require an assessment before you are granted this facility.
  • Interest only: You may be able to get an interest only feature for up to five years. However, keep in mind that although you only pay interest during the interest only term, you’re not paying off the actual mortgage.
  • Line of credit (LOC): Some lenders allow you to get a line of credit, provided that you can prove that you’re a low risk applicant. You can get a very high limit, even up to a million dollars or more, depending on your application and the lender.
  • Redraw facility: You can get a redraw facility as long as you meet the lender’s requirements. A redraw facility allows you to draw any additional funds that you have paid in advance.
  • Offset account: You can get a 100% offset account which can help you pay off your loan sooner. It can also help you save on interest expenses.

Keep in mind that some lenders may not offer certain features. You may also be charged a fee for some of these features so applying with the right lender is essential!

Who is a business fixed rate loan suitable for?

Business loans aren’t regulated by the National Consumer Credit Protection (NCCP) act. This means that you may be able to find lenders that are more flexible with their policies.

Despite this, you’ll still need a strong application as lenders are more conservative towards businesses because of the high risk involved. You may be more likely to qualify if you have a strong existing business operating within a lower risk industry.

Business loans are assessed on a case by case basis, which means that there are no set guidelines to qualify for business loans.

Typically, lenders consider several things, such as:

  • How much money you’re putting into the deal.
  • Your business experience.
  • The type of business.
  • Your security property.

A fixed rate business loan lets you have the certainty of fixed monthly repayments at a competitive rate, at least until the fixed term ends.

It’s recommended that you don’t fix your interest rate if you’re planning to:

  • Sell the business or property.
  • Make large lump sum repayments.
  • Switch lenders or look for another business loan anytime soon.

This is general information only. We advise you to seek independent advice from a legal and professional advisor before you decide to finance your business.


Fixed rate business loan FAQs

Can I refinance a business loan?

Yes, some lenders allow you to refinance a business loan to another lender.

Refinancing your business loan to another lender with a more competitive interest rate can help you save thousands of dollars. However, you can end up losing money instead if you’re going in without a plan beforehand.

It can be fairly easy to refinance a business. Check out Refinance A Business Loan page to learn about the business loan refinancing process in more detail.

Where can I get a great deal?

Usually, lenders don’t advertise their best rates, especially when considering business loans as each application is assessed on a case by case basis.

The interest rate for the loan is usually negotiated based on the loan size, the lender and the strength of your application. This can make it difficult to shop around for a great interest rate.

However, we’ve made this easier for you by publishing the most competitive rates available from our panel of almost 40 lenders.

Check out the business loan interest rate page to find the best fixed rates as well as the best variable rates available.