DFP can assist Property Developers with a low-doc or lease-doc loan for those who wish to lend against an income producing future development site.
Low Doc Commercial loans can also be utilized by Property Developers and Investors who want to acquire older commercial or retail property and realise its upside potential by undertaking a refurbishment and releasing program during the low-doc loan term and then refinance to a Bank Loan upon completion with improved value and serviceability and leasing profile.
The Benefits of Non-Bank Commercial Property Loans
- Non-Bank Commercial loan financiers assess loan serviceability in a manner which is less onerous than traditional Bank loans.
- The serviceability of a (Low Doc) Non-Bank Commercial Loanis assessed against the net rent of the Commercial Property Security in its own right.
- Both the level of rent vs the level of interest and the length of the remaining lease term or WALE is assessed in a less conservative manner than the approach adopted by Banks.
- The shorter lease terms that are accepted by Loc Doc Commercial Loan financiers are ideal for Property Developers given the ultimate intention in the short to medium term is to redevelop the site.
- LVR’s are generally comparable to traditional Bank finance with interest costs being in the order of 6%-8%.
- Loan terms are flexible however generally loan terms of between 1-3 year are most common.
- Loan Approvals are relatively fast when compared to Banks with approval time frames being 1-2 weeks.
A key example of a successful non-bank commercial property loan that Development Finance Partners have provided is: