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Commercial loan without switching business banking

Posted: Tue Jun 28, 2016 5:36 pm
by Brandon Fisher
I've come across a very good commercial property near Perth and I want to get a commercial loan to buy it. I understand that I may have to switch my business banking to whatever lender I apply with.

I actually have more than a few business banking products and arrangements with my current lender so is there any way to get a commercial loan without the need to switch business banking? All replies / comments will be much appreciated.

Re: Commercial loan without switching business banking

Posted: Wed Jun 29, 2016 9:02 am
by Otto Dargan
Hello Brandon Fisher. Welcome to the forums.

Most of the time when you get a commercial loan, you have to switch your business banking to that lender.

However, there are some some lenders that can allow you to continue your business banking with your current lender, specifically in cases where you're:
  • Simply borrowing against residential or commercial property, meaning that you have no unsecured portion.
  • Borrowing less than $1 million.
  • Taking out a commercial loan with no annual reviews, meaning that your loan is for a non-specialised commercial property.
Hope this helps.

Cheers,
Otto

Re: Commercial loan without switching business banking

Posted: Wed Jun 29, 2016 3:47 pm
by Brandon Fisher
Yes, that does help. Thanks. My loan size will definitely not be more than $1 million but I'm getting confused as to whether or not the property I'm looking at is specialised. I'm also considering a few other properties just in case so it would really be great if you could give me a brief as to what properties are considered specialised and what aren't by the banks.

Re: Commercial loan without switching business banking

Posted: Thu Jun 30, 2016 9:15 am
by Otto Dargan
Hi Brandon Fisher,

If your commercial property has a wide appeal, is in a good location and is zoned as residential, commercial, industrial or mixed then it will most likely be considered a standard commercial property, e.g. offices.

The following are generally considered standard commercial properties, which are usually the best type of security for a commercial property loan:
  • Factories and warehouses.
  • Shop fronts and retail space.
  • Residential (block of units, house, unit or townhouse).
Specialised commercial properties are usually difficult to sell because they appeal to a more niche market and are also difficult to value. This is because they are understandably perceived as a higher risk to the lender, e.g. Farms and other rural properties.

Other properties commonly considered as specialised commercial properties include:
  • Accommodation (backpacker, motel, hotel, resorts, bed and breakfast, caravan parks).
  • Aged care centres and car yards.
  • Child care / preschools.
  • Function / reception centres.
  • Land subdivisions.
  • Service stations or petrol stations.
  • Property developments.
  • Pubs / hotels / taverns and restaurants.
  • Shopping villages / centres, etc.
If there's anything more you'd like to know, you can check out our website. You can also discuss your situation directly with one of our mortgage brokers by calling 1300 889 743 or enquire online for a free online assessment today.

Cheers,
Otto

Re: Commercial loan without switching business banking

Posted: Thu Jun 30, 2016 7:14 pm
by Brandon Fisher
Thanks again, Otto. You've been very helpful. I think it would really be good to get some help from the home loan experts. Will probably call you guys by Friday next week. Good night!