Amount I can borrow on a service station loan

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Lakhe
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Joined: Wed Mar 02, 2016 8:56 am

Amount I can borrow on a service station loan

Postby Lakhe » Wed Mar 02, 2016 10:56 am

Hello there, I want to borrow to buy a service station in Northam, which will be my first investment property. I recently came up with some money and I wanted to use it to invest. How much are the banks willing to lend to me?

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Otto Dargan
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Re: Amount I can borrow on a service station loan

Postby Otto Dargan » Wed Mar 02, 2016 2:10 pm

Hi Lakhe, welcome to the forums.

With a service station or petrol station loan, you can generally borrow up to 50% to 60% of the property value. All loan applications with loan amounts of more than $5 million will be assessed case by case.

The banks may usually need you to provide them with a business plan and profit forecasting for the service station. The interest rates and rate discounts will vary depending on which lender you apply with as well as your personal financial situation.

However, there's more to getting a good deal with low fees and a strong interest rate. You can find out more about this as well as the features on your loan in the commercial loan features page.

Please note that your business experience or the experience in the industry will also be counted so if this is your first investment then it may be difficult to secure finance because your application may be considered a high risk.

Cheers,
Otto
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Lakhe
Posts: 5
Joined: Wed Mar 02, 2016 8:56 am

Re: Amount I can borrow on a service station loan

Postby Lakhe » Wed Mar 02, 2016 7:20 pm

My uncle has a lot of experience in investing as well as running a business. He owns a few service stations so can I apply for a loan with him as a co-applicant? That should make us a more credit borrower, right?

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Otto Dargan
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Re: Amount I can borrow on a service station loan

Postby Otto Dargan » Thu Mar 03, 2016 8:11 am

Hi Lakhe,

Lenders will usually want to see the name of the co-applicant also on the title of the property. That means that you guys will also have to be joint owners of the property.

This is because the lenders want to avoid an event where the co-applicant may leave or try to break out of the loan contract later on because they aren't a stakeholder in the property.

It's best that you speak with an accountant or a professional financial advisor along with your uncle to get an idea of what may be best to do.

In the meantime, you can check out our website to learn more. You can also speak with one of our service station loan specialists directly by calling us on 1300 889 743 or enquire online for a free assessment within 24 hours.

Cheers,
Otto
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

Lakhe
Posts: 5
Joined: Wed Mar 02, 2016 8:56 am

Re: Amount I can borrow on a service station loan

Postby Lakhe » Thu Mar 03, 2016 3:45 pm

Yeah, you're right. I'll surf through your site for now and will call you guys once I talk to my uncle and a financial advisor. Thanks for everything :)

oran-g
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Joined: Wed Oct 07, 2015 8:11 am

Re: Amount I can borrow on a service station loan

Postby oran-g » Mon May 30, 2016 4:58 pm

Hi, I understand that we can only borrow up to 60% of the property value with a petrol station loan. I don't really like that amount and would prefer to borrow more. Any way to do this?

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Otto Dargan
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Re: Amount I can borrow on a service station loan

Postby Otto Dargan » Tue May 31, 2016 10:07 am

Hi oran-g,

If you have existing equity in property then you may be able to borrow more 60% of the value of the service station.

If you own a business then you can also go for lenders that can do a 'balance sheet lend'. This means that your loan will be lent against the value in your business.

This will consider your business assets such as trail books, equipment and vehicles (and even goodwill) as security in this case. The great thing about this is that it will allow you to borrow more.

If you have something that can provide a guarantee against your loan then that too can be a way to borrow more than 60%.

The 100% commercial loan page has more details on all this if you want to learn more.

Cheers,
Otto
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

oran-g
Posts: 5
Joined: Wed Oct 07, 2015 8:11 am

Re: Amount I can borrow on a service station loan

Postby oran-g » Tue May 31, 2016 4:33 pm

Thanks for that. Equity, check… guarantor, possibly… Let's see what works. I'll give you guys a call once I make a decision. Cheers.


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