Commercial Property Refinance
Restructure existing commercial debt, access equity or change loan structure through a commercial refinance. We review your current position and assess options across lenders suited to your scenario.
Who is commercial refinance suitable for?
Commercial refinance is relevant for borrowers with an existing commercial loan who want to review their lending arrangements. Common motivations include the end of a fixed rate period, a significant change in property value or business circumstances, a desire to consolidate multiple facilities, or to access equity that has built up in the property. Refinancing is subject to full lender assessment and there is no guarantee of approval or improved terms.
Common reasons to refinance commercial property
- Fixed rate period expiring and wishing to review options
- Business or property value has changed materially since original loan
- Consolidating multiple commercial debts into a single facility
- Accessing equity from property for business expansion or other purposes
- Restructuring loan term or repayment type (e.g. interest-only to P&I)
- Current lender unable to meet ongoing business needs
How lenders assess commercial refinance applications
The assessment process for a refinance is broadly similar to a new commercial loan application. Lenders will require current financial documentation, a valuation of the security property, details of existing liabilities and the loan purpose. Where equity is being released, lenders will consider the LVR post-refinance and the ability to service the total facility.
Refinancing is not always straightforward. Break costs may apply to existing fixed-rate loans. Discharge fees, establishment fees and valuation costs all affect the net financial outcome. We discuss these factors upfront so you can make an informed decision.
Typical documentation required
- Current loan statements showing balance and repayment history
- Two years of business financial statements and tax returns
- Recent BAS statements
- Current tenancy schedule or lease agreements (if investment)
- Identification documents
- Details of all existing liabilities
Loan structures and repayment options
Refinanced commercial loans can be structured on fixed or variable rates, with P&I or IO repayments subject to lender approval. The most suitable structure depends on the borrower's cash flow needs, the property's characteristics and the lender's current product range.
Common challenges
Challenges include a reduction in property value since the original loan (which may increase LVR above a lender's policy limit), deterioration in business financial performance, a change in the tenancy profile of investment properties, and the cost of break fees on existing fixed-rate loans. Where mainstream refinance is not available, non-bank or private lender solutions may apply.
Frequently Asked Questions
Will refinancing save me money?
Not necessarily. Whether refinancing results in a financial benefit depends on your existing loan terms, any exit costs, new establishment fees, and the rates and terms available from alternative lenders. We can help you understand the full picture before making a decision.
Can I access equity when refinancing my commercial property?
Equity release is possible when refinancing if the property has increased in value and the proposed LVR is within the lender's policy limits. The funds can generally be used for business or investment purposes, subject to lender approval.
Are there costs associated with refinancing?
Yes. Potential costs include discharge fees from the outgoing lender, break costs on fixed-rate loans, establishment fees for the new loan, and valuation costs. We discuss these at the outset so you can make an informed assessment of whether refinancing makes sense for your situation.
How long does a commercial refinance take?
Timelines depend on the complexity of the transaction, documentation readiness and the lender's process. A straightforward refinance may settle within four to eight weeks. More complex scenarios may take longer.
Can I refinance if my property has declined in value?
A reduction in property value may affect your available LVR and the lenders willing to assist. Some non-bank lenders may be able to help where mainstream options are limited, though pricing and conditions will differ.
What if my financial position has changed since the original loan?
Changes in business income, expenses or structure affect how lenders assess a refinance application. Low-doc options may be available for some scenarios. We review your current position and identify the most appropriate lenders to approach.
Discuss Your Refinance Scenario
Related Commercial Finance Services
General information only — not personal financial or credit advice. All finance subject to lender assessment and approval. Michael Short, Credit Representative 468493 under ACL 389328.