Business Line of Credit, popularly called an Overdraft. This feature gives you the flexibility to access the funds and use it as you see fit. This provides the borrower with the flexibility to use the funds when needed. It is a fact that you will only pay interest on the amount that is used. Companies use the overdraft as a quick fix to fund unexpected business expenses. It has proven to be an effective method of keeping businesses afloat when they face gaps in their cash flow.

A business overdraft can provide the extra cash your business needs to cover seasonal or working capital requirements. Essentially, an overdraft is a method of allowing an account balance to operate in debit up to a pre-approved limit. These facilities are usually secured against property.

Generally, as long as the minimum monthly interest is covered, clients can clear this debt at any point in time and have funds available up to the limit as business opportunities arise. It also provides a convenient means of dealing with fluctuations in cash flow which every business experiences.

A Term Loan is a form of financing, where the repayment of the loan is amortised over a specific numbers of years, like a home loan. This form of financing is available to assist in the funding of business growth or expansion, consolidation of business debts, capital and equipment purchases as well as the purchasing or development of commercial property for owner occupation or investment; essentially any worthwhile business purpose.

A term loan facility offers the flexibility of fixed or variable interest rates, with a choice of repayment options to cater for your businesses cash flow requirements. Most Lenders/financiers allow the repayment of term loans up to 15 years. Maximum lending margins are generally assessed at 65% of the valuation of a commercial property and 80% on a residential property. There are a few lenders who can consider lending above these margins subject to terms and conditions.

A lease financing agreement empowers a business to use a particular asset for an agreed period while making payments to the owner (the lessor), which in most cases are a bank. The business owner or company is given the option to either buy or refinance the asset once the agreed period expires. However, the condition to purchase or refinance is considered when there is a residual payment known as Balloon Payment left to be paid. Despite this, most businesses choose to either buy the asset by making a final payment or trade it for a newer version and still keep up with the lease agreement. The excellent thing about lease financing is that the business gets to choose the contract terms. Thus, allowing them to enjoy the freedom to use the assets. Since it is your asset, you already know all the costs upfront, making it almost impossible for any surprising fees or charges to come up.

Cashflow and having flexibility are two crucial aspects when it comes to establishing financing and funding arrangements for your pub, club, hotel or accommodation business. At SBS Financial, our extensive experience in these areas means that we can quickly assess your current funding situation and recommend the right lender, loan type and structure for your business.

While there are many risks involved in both property development and property investment finance, our knowledgeable team can assist you to identify, quantify and manage those risks. Whether your project involves commercial, retail, residential development or investment finance, we can source the most competitive funds to help you to watch your business goals come to fruition.

With countless Australians moving around the country or overseas for work, study and family reasons, there has been an increasingly growing demand for personal storage solutions. And since there are only a few options for self storage, many see this area of business to be an attractive investment or business opportunity. So if you are one of those people looking to invest in an existing facility or developing your own, SBS Financial is here to help you get a better deal on self storage finance and connect you with the right people in the industry.

Since banks generally see petrol or service stations as specialised commercial property, this often means that the maximum value that they will finance is much lower than standard commercial property. So even though they are an attractive business proposition, many of our clients find that securing funding is somewhat difficult. However, our team can provide information about the best banks to approach and help you to find the best ways to fund commercial property acquisitions or finance improvements of both freehold and leasehold petrol stations.

Another attractive business proposition in a nation of working families is the investment in childcare centres. Whether it is operated as a freehold going concern, leasehold going concern, or freehold investment operation, SBS Financial can assist you with sourcing the best lender, childcare centre loans and structure for your business.

If you are seeking health, medical or aged care finance solutions, our team is here to steer you in the right direction! We often work with businesses and professionals in this industry, so we know the most effective ways to maximise profits and reduce risk via sourcing and structuring competitive finance solutions, such as aged care and medical loans.

• hospitality
• medical
• healthcare
• travel
• information technology
• manufacturing
• construction
• mining
• engineering
• steel fabrication

So if you’re looking for hire purchase loans or operating lease finance, we are here to help. We will source the most competitive and reliable funding options.

Do you require business finance but are limited by the amount of security you have available? If you have a list of debtors you may be in a position to leverage of these ‘future payments’. Invoice Financing is another flexible form of lending, where funds are advanced against moneys (debtors) owed to you by your clients. It is a highly flexible and increasingly popular way to raise finance, sometimes without the need to provide bricks and mortar security.

If you compare Invoice Financing to a traditional overdraft facility, the overdraft facility is limited to the amount of security available.

Invoice Financing on the other hand, can increase along with your company. As a business grows, your expenses generally increase right along with the turnover. At the same time, you will be attracting new clients and all too often, companies will experience significant cash-flow shortages as a result.

Because you are attracting new customers, your business has to maintain its control and ensure that moneys owed to you are collected within a reasonable time frame to cover your ongoing fixed expenses including manufacturing costs and wages for your staff. This is where invoice financing can be a real asset to your growing business.

You can borrow up to 70% -80% of the property value although in many cases this may be restricted to 60%.

The interest rate will be higher than it is for residential properties purchased through a SMSF.

Most major banks will look to see if your asset position is strong. They will generally be more willing to lend to you where you have a wide and varied existing investment portfolio that will provide good security to the bank and minimise the risk of lending. Each lender varies significantly with both their LVR’s and interest rates.

Thinking of doing business? Commercial loans are popular with investors that are using their SMSF to secure finance so that they can carry out a commercial project.

Most banks will generally allow you to borrow money in your trust, as you would for commercial properties in your personal name. However, lenders will often reduce the amount that you are eligible to borrow.

This is because the risk is higher for these loan types and the bank tries to minimise this risk by restricting the LVR (Loan to Value Ration) of your loan.

Unlike most conventional home loans for residential properties, commercial loans carry a higher degree of risk.

If the property that is being purchased is a shop or another type of income producing business, it will be subject to various economic conditions.

This will make it harder to assess the borrowers ability to service the loan and will increase the need for suitable security to ensure that the bank does not incur loss as a result of lending to you.

However, there is a chance that the security you offer could also devalue, which makes it even more difficult for the banks to appraise.

Often the repayment of the commercial loan is dependent on the financial success and viability of your business.

It follows that if the business is experiencing cash-flow issues, your ability to repay the loan may be reduced. The banks take all of this into account when assessing how much you can borrow. Generally, most lenders will restrict the LVR of your commercial investment loan.

It may be significantly easier to obtain a residential loan for your SMSF.

This is because the bank will look at your income, as well as the value of the property you are buying.

It will be much easier for the lender to assess the value of your security type and it will generally be subject to less market volatility.

Commercial loans are generally taken out by businesses that need finance to fund their business activities.

For many businesses, this means purchasing property that will become the business premises. The site is then used to conduct and operate activities to generate an income.

The loan may cover expenses such as fit out and the purchase of supplies to assist in setting up and establishing the business.

Self Managed Super Funds (SMSF) can obtain commercial loans to fund their business activities, much like a company.

However, as with all other loan types, the SMSF will need to prove that they are able to repay the loan according to the loan agreement.