Commercial Property - Interest Rate
- Thread starter jon2378
- Start date
If it's just rate your after, than below are some of the cheapest commercial loans available.
With a tier 2 Australian bank ( not the big 4 tho...) -No residential security required, no cross securitization- stand alone security.
Variable: 5.78%
Fixed 1 year -5.37%
Fixed 2 year -5.45%
Fixed 3 year -5.40%
Fixed 4 year -5.69%
Fixed 5 year -5.86%
With a Australian Non-bank lender ( Major life insurance company- institutional Superannuation funder)- residential security required, no cross securitization- stand alone security.
Variable: 5.40%
Fixed 1 year -4.99%
Fixed 3 year -5.32%
Fixed 5 year -5.72%
With a tier 2 Australian bank ( not the big 4 tho...) -No residential security required, no cross securitization- stand alone security.
Variable: 5.78%
Fixed 1 year -5.37%
Fixed 2 year -5.45%
Fixed 3 year -5.40%
Fixed 4 year -5.69%
Fixed 5 year -5.86%
With a Australian Non-bank lender ( Major life insurance company- institutional Superannuation funder)- residential security required, no cross securitization- stand alone security.
Variable: 5.40%
Fixed 1 year -4.99%
Fixed 3 year -5.32%
Fixed 5 year -5.72%
^ Major lenders don't have a "standard" comm rate as such...it's all negotiated based on
- Loan amount
- Security
- LVR
- Security
- Security
- Location
- Tenants
- Lease
- Overall financial strength of your portfolio and file
- Valuation comments
Comm rates are always done on a "risk for rate factor" majority of the time.
P.s something you might want to look into is a condition called "annual review" , exit cost and fees
It's a pain in the *** and costly no matter what rate they offer rate is soon forgotten..................... annual reviews come round annually.
Usually these arent a hassle............ but think of why a lender would want that.
ING and Adelaide Bank both offer non reviewable TERM loans with the former being on the lower side of the rates market.
As has been alluded to if you have resi security, then rates in the sub 5 for 900 k would not be uncommon.
Im guessing the next question should be around LVR
ta
rolf
Usually these arent a hassle............ but think of why a lender would want that.
ING and Adelaide Bank both offer non reviewable TERM loans with the former being on the lower side of the rates market.
As has been alluded to if you have resi security, then rates in the sub 5 for 900 k would not be uncommon.
Im guessing the next question should be around LVR
ta
rolf
Low to mid 5's are achieved through fixes at this time, but as Rolf said the primary concern should be based in avoiding loans with annual reviews.
60% LVR shouldn't give you any problems, unless you've got a very undesirable security.
60% LVR shouldn't give you any problems, unless you've got a very undesirable security.
I have a $1.4mill commercial loan with CBA and they've told me that over $1mill they must review annually thanks to gov regs. Just wanted to know if true?
What are the downsides of annual review, apart from the work? Ever heard of one going wrong!
I'm paying roughly 6.3% variable, 80% lvr. What rates and lenders could do better?
What are the downsides of annual review, apart from the work? Ever heard of one going wrong!
I'm paying roughly 6.3% variable, 80% lvr. What rates and lenders could do better?
No idea but my bank changed a loan with no annual reviews into an annually reviewed loan using new APRA requirements as an excuse. Of course I noticed when I signed up that little clause in the loan agreement saying that they could modify any of the terms and conditions of the loan at any time. Really that's the only clause I needed to know! The excuse was hardly relevant...
I don't like annual reviews and am really not looking forward to the next one now that I'm sans employment but that's the risk we take in playing this game. I have put some cash aside in case things get nasty...
That's the story I got to. At least mine was a new loan so no surprise though. Don't you love loan doc clauses, you'd never sign them any other time but you need the money, lol
That annual review info / excuse is BS I reckon. There are a few commercial lenders who advertise the fact that they don't do annual reviews at all.
80% LVR is your main hurdle for getting a good commercial rate as most want 70% or less. At 65-70% LVR 5.9% pa would be sharp.
