Which lender is right for your commercial property loan?
Traditional Banks vs. Non-Banks vs. Private Lending: Which is Right for Your Commercial Property Loan?
In the world of commercial property finance, securing the right loan can make or break a deal. Whether you’re an investor, business owner, or developer, choosing the right lender—traditional banks, non-banks, or private lenders—can impact your borrowing power, loan terms, and ultimately, the success of your transaction.
So, which option is best for you? Let’s break it down.
1. Traditional Banks: The Gold Standard, but With Strings Attached
Pros: ✅ Lowest interest rates—major banks offer the most competitive pricing. ✅ Reputable & regulated—well-established lenders with strict lending criteria. ✅ Longer loan terms—making repayments more manageable.
Cons:
❌ Stringent lending criteria—harder to qualify, especially for unique properties or lower-doc borrowers.
❌ Slow turnaround times—can take weeks or even months for approval.
❌ Lower LVRs—typically require a 20-40% deposit [depending on loan size], limiting borrowing power.
Best For: Investors or business owners with strong financials who don’t need fast approvals.
2. Non-Banks: Flexible Solutions for Complex Deals
Pros:
✅ More flexible lending criteria—suitable for borrowers with lower-docs or unique property types.
✅ Faster approvals—less red tape, making them ideal for time-sensitive deals.
✅ Higher LVRs—can go up to 75-80%, meaning a lower deposit requirement.
Cons:
❌ Slightly higher interest rates than traditional banks.
❌ Potentially shorter loan terms, depending on the lender.
Best For: Borrowers who need more flexibility, faster approvals, and higher LVRs but are willing to accept slightly higher rates.
3. Private Lending: When Speed & Customisation Matter Most
Pros:
✅ Quickest approvals—ideal for last-minute deals or auction purchases.
✅ Tailored lending—great for complex or non-traditional property transactions.
✅ No credit scoring—focus is on asset strength, not just financials.
Cons:
❌ Higher interest rates—can range between 8-15% depending on risk.
❌ Shorter loan terms—often 6-36 months, requiring an exit strategy.
❌ Higher fees—setup and exit fees can be higher than banks or non-banks.
Best For: Investors and developers who need fast approvals, have complex financials, or need short-term solutions before refinancing.
Commercial Real Estate Agents: Partner with a Broker for Smoother Transactions
If you’re a commercial real estate agent, you know that finance delays can derail a deal. Partnering with a commercial mortgage broker like myself ensures:
✔ Faster approvals, keeping deals on track.
✔ More lending options, increasing the chances of loan approval.
✔ Tailored solutions, ensuring buyers get the right structure for their investment.
I work closely with agents to navigate financing hurdles and help their clients secure the right loan—so you can close more deals, faster.
Need Finance? Let’s Talk.
Choosing the right lender depends on your timeline, financials, and loan structure. Whether you need bank finance, a non-bank lender, or private funding, I can help find the right solution.
📞 Call Matthew Stack from Loan Market on 0423 2372 242
📧 Email: matthew.stack@loanmarket.com.au
📅 Book a Free Call: https://calendly.com/matthew-stack-g7e/15mins
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