When the problem is timing, not money
Plenty of healthy businesses hit a wall not because they are short of money, but because the money arrives a few weeks too late. A property sale settles next month but the deposit on the next one is due now. A large customer pays on 60-day terms but wages are due Friday. A bank has approved your refinance but the settlement date keeps slipping.
For situations like these, a long-term loan is overkill. You don't need money for years; you need it for weeks. Equity Tap lends for terms from one month to twelve months, so you can borrow for one, two or three months and repay as soon as your funds arrive.
Typical one to three month scenarios
| Situation | What the loan covers | How it is repaid |
|---|---|---|
| Waiting for a property sale to settle | Deposit, purchase or business costs before settlement | Proceeds of the sale |
| Bank refinance delayed | Urgent payments while the bank finishes its process | The refinance |
| Large invoice or progress claim outstanding | Wages, suppliers and subcontractors | The invoice payment |
| Business sale agreed but not completed | Final costs, creditors or the next venture | Sale proceeds |
| Insurance claim approved but not paid | Repairs, stock or reopening costs | The insurance payout |
| Purchase settlement at risk | The shortfall to settle on time | Refinance or sale |
If you are trying to settle a property on time, also see urgent property settlement loans and our property sale advance.
Why short terms need a fast lender
A one-month loan that takes six weeks to approve is useless. Speed is the whole point. Conditional approval can often be given on the phone and a term sheet issued in about 30 minutes once we have the scenario. Eligible loans can settle in as little as 24 hours. There is no credit committee to wait on: the person who answers the phone is often the person who makes the decision.
We also cut out the steps that slow other lenders down. We don't order a valuation before approval. We don't need tax returns, BAS or bank statements for a property-secured loan. That means less paperwork and fewer days lost.
What makes a good very short-term loan
- A clear, dated exit. A contract of sale with a settlement date, a refinance approval, an invoice with payment terms or a business sale agreement.
- Equity in Australian property. Residential or commercial, offered as a first or second mortgage or caveat.
- A realistic term. If settlement is due in five weeks, we might suggest two or three months to give a buffer for delays.
- A business purpose. The funds must be used for the business, not for personal or household purposes.
Repayments over a short term
On a one to three month loan, most borrowers choose to have the interest prepaid or added to the loan so there are no payments at all during the term. You then repay the loan in one amount when your funds arrive. Alternatively, you can pay interest only monthly. Interest is not waived in any structure; it is simply timed to suit you.
An example
For example, a business owner who has exchanged contracts on the sale of a warehouse, with settlement in eight weeks, may have a creditor or tax bill that has to be paid now. A two or three month loan secured over the warehouse or another property can clear that bill this week, then be repaid in full from the sale proceeds at settlement. The owner doesn't refinance anything or touch their home loan.
What we need
- ID for borrowers and guarantors.
- The address of the security property and details of any existing mortgage.
- The purpose of the loan.
- Exit evidence, such as the contract of sale, refinance approval, invoice or sale agreement.
If your exit is delayed
Settlements slip and customers pay late. If that happens, talk to us early. We look at each situation individually. Choosing a slightly longer term at the start is usually the simplest way to avoid pressure later. For more on bridging, see business bridging loans and refinance bridging loans.
Pricing
Each loan is priced on the client's individual circumstances, aiming for the sharpest rate available for that situation. The full cost, including the payout figure, is shown before you proceed.
Why not use an overdraft or credit card?
For small gaps, an overdraft or card can work. For gaps of $50k or more they rarely have the limit, and asking a bank to increase an overdraft brings back the same financials, credit checks and waiting you were trying to avoid. A cash flow lender can be quick, but daily debits start straight away and the amount is tied to turnover. A short secured loan gives you the full amount at once, with no payments until your funds arrive.
Get funded this week
If your money is on its way but you need it now, call 1300 123 024 or apply online. Brokers with a client caught in a timing gap can send the scenario through our broker page.
Business-purpose lending only. Approval, timing and terms depend on the scenario.
Frequently asked questions
Can I borrow for just one month?
Do I have to make repayments on a one-month loan?
What if my settlement is delayed past the loan term?
How fast can a one-month business loan be approved?
What security do I need for a very short-term loan?
Can I use a one-month loan while waiting for a bank refinance?
Brokers: send the scenario through the Equity Tap broker channel and you will deal with the same lending team.