Commercial property loans, explained before you sign anything.

In four ways that matter. The term is usually much shorter and often carries a review or expiry date, so the facility is not set-and-forget. The assessment centres on business or rental income rather than personal payslips. The security is judged on how readily that particular building could be re-let or sold, not on a broad residential market. And because the purpose is business or investment, the loan commonly sits outside the consumer credit regime, so protections you would have on a home loan may not apply.

More than a residential purchase as a general rule, and we will not put a number on it here because any figure we gave you would be a guess. What a lender looks for depends on the property type, whether it is leased, the strength of your financials, the structure you are buying in and that lender's own policy. Budget for transaction costs on top, including duty, legals, valuation and any GST treatment your accountant identifies.

It means the arrangement is not permanent. At a review date the lender reassesses the facility against your current financials and the property as it stands; at an expiry date the balance falls due and must be repaid or refinanced. In good conditions this is routine. It hurts when trading has dipped, the tenant has gone or values have fallen, which is the moment you would least like to be re-qualifying. Know when the date is, keep the accounts in order, and start the conversation well before it arrives.

Often not, and this is worth being blunt about. Credit provided predominantly for business or investment purposes generally falls outside the National Credit Code, where much of the consumer protection framework lives, including responsible lending obligations, prescribed disclosures and the statutory hardship provisions. Your rights come primarily from the loan contract itself, so the contract deserves real attention and a solicitor's eyes.

If you are borrowing through a company, trust or fund, expect to be asked. A director's personal guarantee is normal practice rather than a sign of a difficult application, but it is a genuine personal obligation: if the borrowing entity cannot pay, you can be pursued in your own name, and if the guarantee is backed by a mortgage over your home then your home is exposed. Get independent legal advice on it before you sign, every time.

For an investment purchase it is one of the central questions, because the income is only as reliable as the business paying it. Lenders look at who the tenant is and how long they have traded, how much of the lease term remains, who holds the renewal options, how rent reviews are set, whether outgoings sit with the tenant or the owner, and what bond or security is held. A short remaining term does not end the conversation, but it changes it, so tell us upfront.

All three are common, and owning your business premises through a trust or a fund is a well-trodden path. Each brings its own legal and tax consequences, and an SMSF purchase is additionally governed by superannuation law: it must be consistent with the fund's investment strategy and is usually structured through a limited recourse borrowing arrangement, which not every lender writes. We can tell you how lenders are likely to view a structure and where it narrows your choices. Which structure is right for you is a question for your accountant, your solicitor and, for anything involving super, a licensed financial adviser.

It is the most common hold-up we see, and it is fixable. Because these loans are usually assessed on business performance, out-of-date or unlodged returns leave a lender with nothing solid to assess. Getting your accountant to bring the returns up to date and produce current interim figures is often the highest-value week you can spend before applying. Where that is genuinely not possible there are lenders who work from alternative evidence, though the trade-off usually shows up in pricing or in how much you need to contribute.