Finance
Types of property finance
What each type of finance is, how it is secured and repaid, what it costs to structure and what to ask before you sign. Privet explains; it does not lend, rank lenders or quote rates.
01
Short-term and private
- First mortgage private loansShort-term loans secured by a first registered mortgage, assessed mainly on the property and the exit.
- Second mortgage loansFunding secured behind an existing first mortgage, unlocking equity without refinancing the senior loan.
- Caveat loansVery short-term funding where the lender protects its interest by lodging a caveat on the title.
- Bridging financeFunding to buy the next property before the current one sells, or to cover a settlement timing gap.
02
Development and construction
- Construction and development financeProgressively drawn funding for residential and commercial construction, released against verified progress.
- Mezzanine financeSubordinated debt that sits between senior debt and the developer's equity in a project.
- Preferred equity and joint venture capitalCapital that takes an equity position in a project with priority returns or a profit share, rather than lending.
- Pre-development and DA fundingFunding to acquire or hold a site and pay for design, reports and approvals before construction finance.
- Refurbishment financeShort-term funding to buy and improve a property, often released in stages as works are completed.
- Cost overrun and GST funding facilitiesFacilities that fund unexpected cost increases or the GST payable during a project, alongside senior debt.
- Land and residual stock loansLoans against vacant land, sites awaiting approval, or completed but unsold dwellings.
03
Commercial and specialised
- Commercial property loansFinance for offices, retail, industrial and specialised commercial assets, assessed on income and lease profile.
- Business funding secured by propertyFunding for business needs, including tax debts and creditor pressure, secured against real property.
- SMSF property lendingBorrowing by a self-managed super fund to buy property, which must follow strict superannuation rules.
- Vendor financeArrangements where the seller lends part of the purchase price to the buyer instead of a lender.
- Low-doc and non-conforming loansLoans for borrowers whose income or credit history does not fit standard bank policy, including regulated loans.
- Rural and specialised asset loansFinance secured by farmland or specialised property such as hotels, childcare centres or service stations.
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