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Commercial finance

Commercial Finance for Business Owners and Property Investors

Commercial finance is rarely just about obtaining a loan. The structure of the lending affects cash flow, how capital is used, how much flexibility you keep and what you can fund next.

Arrange a ConsultationWho we arrange finance for
Colleagues reviewing figures together in a meeting room
  • Working capital, purchases, expansion and premises
  • Structure before lender
  • We arrange the credit; the lender assesses and decides

Oakwood Finance arranges commercial finance for business owners and property investors nationwide: working capital, business purchases and expansion, equipment, and the property a business operates from. We take a considered approach to every engagement, understanding the complete financial position before recommending how the lending could be structured, subject to lender assessment.

This page covers the business side of commercial lending and gives an overview of the range. For buying or refinancing premises, see commercial property loans. For funding a development project, see property development finance.

Who we work with

Who we arrange commercial finance for

Commercial finance covers a wide range of situations. The ones we are most often asked about:

  • Two people in a joinery workshop surrounded by tools and timber

    Established businesses

    Buying stock, equipment or another business, expanding into new premises or restructuring existing facilities, whether the borrower is a company, a partnership, a sole trader or a trust.

    How an enquiry runs
  • Two businesswomen shaking hands across a desk

    Owners changing hands

    Buying out a partner, taking over a business, or passing it to the next generation, where the price, the goodwill and the existing debts all have to be read together.

    How an enquiry runs
  • Two people inspecting an empty commercial space

    Business premises

    Businesses that own, or want to own, the property they trade from. The property side is covered on our commercial property loans page.

    Commercial property loans
  • Three people talking outside a modern two-storey building

    Property investors

    Property investors who hold commercial assets alongside a trading business, or through companies, trusts or a self-managed super fund.

    Lending across companies and trusts
  • A bright waiting area with green chairs and indoor plants

    Professional practices and healthcare businesses

    Buying in, expanding or funding equipment.

    Medical and healthcare finance
  • Workers in high-visibility vests on a construction site

    Developers and builders

    Developers and builders whose trading business needs working capital or equipment. The project itself is covered on property development finance.

    Property development finance

Oakwood Finance arranges the credit. Each application is assessed and decided by the lender.

Commercial Finance Solutions

Our commercial finance capabilities include:

Commercial property purchases

Commercial property refinancing

Property development and construction finance

Business acquisition finance

Business expansion and growth funding

Working capital and cash flow facilities

Equipment and asset finance

SMSF commercial property lending

Trust and company lending structures

Bridging and short-term commercial finance

Debt consolidation and restructuring

Investment and development portfolio finance

Complex and multi-entity lending

Specialist and non-bank commercial funding

Property developers and project funding

A development project is funded differently from a business or an investment property. A lender will usually size the facility mainly against the project, meaning its feasibility, the builder and the evidence of sales, rather than mainly against a business’s trading history or the rent on a building. That is why developer funding has its own page: property development finance.

Use this page when the question is about the business itself, such as its purchase, expansion, working capital or equipment. Use the development finance page when the question is about a project, from buying the site and funding the build through to unsold stock at the end. A single new home or a rebuild is a different question again, covered by construction finance.

Developers often have parts of their position that do belong on this page:

  • A trading business or building company that needs working capital, equipment or funding to grow.
  • Commercial property held for rent or used by the business, covered in more detail under commercial property loans.
  • Companies, trusts and a self-managed super fund that hold assets alongside the projects, which is where lending across entities comes in.

We look at the developer’s whole position, including existing assets, equity and entities, and how finance arranged for one part may affect another. Oakwood arranges the credit; each proposal is subject to lender assessment.

Finance for Business Owners

Business owners often have financial positions that extend well beyond a standard PAYG income assessment.

Company structures, trusts, retained earnings, distributions, commercial assets and existing facilities can all affect borrowing capacity.

We understand how to present complex financial positions to lenders and can assist with funding for:

  • Business purchases
  • Expansion
  • New premises
  • Working capital
  • Equipment
  • Property
  • Debt restructuring
  • Succession and ownership changes
  • Strategic acquisitions

Our process

How a commercial finance enquiry runs

  1. A conversation before any paperwork.

    What you are funding, by when, and what you need the facility to do for the business. Nothing is lodged and nothing touches your credit file at this stage.

  2. Your position, read the way a lender reads it.

    We go through the financials for each entity, the ATO position and the existing facilities with you and, if you have one, your accountant, so the file reaches a lender complete.

  3. Structure before lender.

    Term debt, an overdraft style facility, equipment finance or a mix; which entity borrows; what security is offered; how the facility will be reviewed and how it will be repaid at the end of its term.

  4. Lender comparison.

    We compare suitable options from our lending partners against your file before anything is lodged, so you are not applying in several places and collecting credit enquiries.

  5. Application through to settlement.

    We prepare and lodge the application, answer the lender's questions as they arise, and stay in touch through approval, documentation and settlement. The lender assesses the application and makes the decision.

  6. After settlement.

    We diarise review dates and expiries so the next conversation with a lender is planned rather than forced.

What helps us give you an initial view

This is what helps us form a view and shortlist lenders. It is not a lender's checklist: each lender has its own requirements and will ask for its own list once an application is under way.

  • What you are funding, roughly how much, and when you need it.
  • The business: how long it has traded, its structure (company, trust, partnership or sole trader) and who owns it.
  • The most recent financial statements and tax returns for each entity, and management figures if the current year is well under way.
  • Your ATO position, including any payment arrangement in place.
  • Existing loans, leases and facilities, and what secures them.
  • Any property, cash or other assets available as equity or security.
  • Your accountant's details, if you would like us to work with them from the start.

Why Business Professionals Choose Oakwood Finance

Business lending is usually assessed on the business behind it, so much of the work happens before an application is lodged. On the business side of commercial lending, we focus on:

Purpose and structure
Matching the facility to what it funds: term debt for a purchase or an expansion, a working capital facility for the gap between money in and money out, or an equipment facility for assets that lose value over time.

The financial picture
Presenting the accounts for every entity involved, your ATO position and your bank statements the way a lender reads them, with your accountant’s explanation of any one-off items included from the start.

Comparing lenders
Commercial lenders differ in the industries, structures and security they may consider, so we compare our lending partners on those points before anything is lodged.

Coordination
Working alongside your accountant, your solicitor and the lender’s credit team, with tax, legal and financial advice coming from the licensed professionals who provide it.

The next facility
Considering what you may need to fund after this one, and how the first facility may affect the second.

Speak to us
An open-plan workplace with staff at work

What changes when the borrower is a business

Commercial lending is not simply a bigger home loan. The term is commonly shorter, the deposit often larger, the facility is usually reviewed while you hold it, and the lender is assessing a trading business rather than a salary. Understanding those four differences up front changes how you plan.

Term, amortisation and the balloon

A commercial facility is commonly written for a shorter term than a home loan, with repayments calculated over a longer period. That typically leaves a balance owing at the end of the term which needs to be refinanced or repaid. Many lenders also hold an annual review at which they can reassess the facility against your latest financials and the property value. A home loan is commonly written over a longer term with little ongoing review. A commercial facility is more often a relationship you renew. We build the exit into the plan at the start rather than meeting it when the term ends.

What gets read, and in what order

Many lenders ask for several years of financials for every entity in the structure, your ATO integrated client account, and the bank statements behind the trading account. Then the security: what the property is, how specialised it is, and who occupies it. Your ATO position often matters more than people expect. An unmanaged tax debt can stop a commercial application quickly, while a disclosed payment arrangement being met on time is commonly workable, subject to lender assessment. Disclose it: lenders routinely check, and an undisclosed debt that surfaces during assessment does far more damage than one you have explained.

Where the flexibility actually is

Commercial credit is commonly negotiated rather than selected off a rate sheet. Interest cover covenants, review frequency, whether a director’s personal liability is capped or unlimited, whether the annual review can require a revaluation: each of these can be put to the lender, and many borrowers never raise them because nobody told them they could. For some borrowers the covenant terms matter more than the margin. What a lender will agree to varies and is subject to its own assessment.

Before you sign a contract

If you are buying commercial premises or arranging business lending, speak with us before you commit to terms.

Commercial finance is arranged nationally. See our local pages for Adelaide, Brisbane, the Gold Coast and Perth.

An illustrative worked example

Trading business buying its premises

Turning rent into an asset without straining working capital

  • A walkway beside a modern commercial building with glass and steel

    Illustrative example

    Structure to consider: term debt plus a working capital overdraft

    The situation.

    An established business has outgrown a lease it has held for a long time. The landlord offers to sell. Buying would turn the rent into a mortgage on an asset the owners keep.

    The complication.

    The deposit could take most of the cash the business uses to fund stock and payroll between invoices. The latest accounts also show a dip caused by a one-off equipment write-down, which on a first read can make the business look weaker than it is.

    What we would look at.

    Presenting the accounts with the write-down normalised and explained, alongside management figures for the current period showing the recovery. Proposing the purchase as term debt against the property with a working capital overdraft alongside it, so the deposit does not come out of the money the business trades on. Raising the review terms with the lender, for example whether it can require a revaluation at each review.

    What the example shows.

    Where the deposit comes from matters as much as the size of the loan, and review terms are worth raising before the facility is arranged rather than after. Whether a lender agrees to any of this is for that lender to decide, and every application is subject to lender assessment.

An illustrative example of how a file like this can be approached. It is not a client outcome, and no result is implied. This is general information only, not credit assistance, a quote or a recommendation. Every structure depends on individual circumstances, lender credit policy and approval. Oakwood arranges credit through its lending partners; all lending is subject to lender assessment and approval.

Questions

Commercial finance questions we are asked

Is commercial finance assessed differently from a home loan?

Yes. The term is commonly shorter, the contribution from the borrower is often larger, some facilities are reviewed while you hold them, and the lender is assessing a trading business rather than a salary. The section above, "What changes when the borrower is a business", sets out the four differences.

Do I need a set trading history?

Lenders differ. Some look for a trading history and recent financials; others consider a shorter history with other evidence such as contracts, BAS or management figures. We look at what you have and which lenders' policies may suit it. Each lender decides for itself.

Can a company or trust be the borrower?

Yes, and it is common. Which entity borrows affects who the lender assesses and what support it asks for from directors or trustees. Your accountant and solicitor advise on the structure; we arrange the finance around the structure they have settled on. See lending across companies and trusts.

I have a tax debt. Does that stop an application?

Not necessarily, but it must be disclosed. An unmanaged tax debt can stop a commercial application quickly, while a disclosed payment arrangement that is being met on time is commonly workable, subject to lender assessment. Lenders routinely check.

What does Oakwood Finance charge?

Where a fee applies to the work, which happens on some commercial lending, we tell you the amount in writing before you commit to anything, and you will see it again on the credit quote you sign.

Which page do I need?

This page covers funding the business itself. For buying or refinancing premises see commercial property loans; for a project funded against its feasibility see property development finance; for vehicles and equipment see asset and equipment finance; for short-term private or non-bank funding see private funding.

Next step

Start a Commercial Finance Conversation

Tell us what you are funding and when. We will come back to you with how we would approach it and what we would need to see.

Speak with us or book a consultation. Meetings are by appointment, nationally and in Adelaide, Brisbane, the Gold Coast and Perth.

Arrange a Consultation

Oakwood Finance Pty Ltd is a Credit Representative (561236) of Finsure Finance & Insurance Pty Ltd, Australian Credit Licence 384704. Oakwood arranges credit through its lending partners; all lending is subject to lender assessment and approval.

Empowering your financial journey

Residential, commercial, development and asset finance, arranged around what you are actually trying to do.

Oakwood Finance Pty Ltd is a Credit Representative (Credit Representative Number 561236) of Finsure Finance & Insurance Pty Ltd, Australian Credit Licence 384704. Information on this website is general in nature and does not take your objectives, financial situation or needs into account. All applications are subject to lender credit approval, terms, conditions, fees and charges.
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