The situation we see every week
A business owner sells a commercial property, a set of units, a development site or a completed development. The contract is signed and the buyer is committed, but settlement is months away. Meanwhile the business needs the money now: to pay out a debt, take up the next project, clear the ATO, buy stock or simply keep moving.
The money is coming. It is just coming too late. Banks are rarely interested in lending for a few months against a property that is about to be sold, and a refinance would take as long as the settlement itself.
How Equity Tap structures it
- We secure the loan against the real estate, usually the property being sold, sometimes another property the owner holds, by first mortgage, second mortgage or caveat.
- The term is set to run past the settlement date with a margin for delays.
- Interest can be prepaid or added to the loan, so there are no repayments while waiting.
- When the sale settles, the proceeds repay the Equity Tap loan first and the balance goes to the owner.
Why owners use it
- Speed: conditional approval can often be given on the phone and a term sheet issued in about 30 minutes once we have the contract details.
- No valuation: the sale contract tells a big part of the story, and we do not send a valuer.
- No financials: the exit is the settlement, so we do not need tax returns or bank statements.
- Short term: the loan exists only until settlement. Nobody wants a twenty-year loan for a three-month gap.
Variations we fund
| Sale type | Typical use of the advance |
|---|---|
| Commercial or industrial property | Working capital, debt payout, next acquisition |
| Development lots or completed units | The next site deposit, paying consultants and trades, clearing short-term debt |
| Off-the-plan or long settlement contracts | Bridging months of waiting for the sale funds |
| Sale of a business with property | Funds for the owner's next venture before completion |
Read more on funding before a commercial property sale settles, property sale advances and loans for property developers. Then send us the contract details or call 1300 123 024.
Frequently asked questions
Can I get money before my property sale settles?
Do you lend against a development that has been sold?
What if settlement is delayed?
Do I have to make repayments while I wait?
Do you need a valuation of the property being sold?
Brokers: send the scenario through the Equity Tap broker channel and you will deal with the same lending team.