Buy, refinance, bridge or release equity
Commercial property loans and bridging finance
Finance to buy the premises you trade from, refinance an existing commercial property loan, bridge a purchase, or release equity from property you already own.
Commercial Property Loans at a glance
- Amount
- $150,000 to $5,000,000
- Term
- 5 to 25 years for a commercial property loan, or months rather than years for bridging finance
- Security
- A first or second registered mortgage over the property. A personal guarantee is standard.
- Time to funding
- Weeks, not days, for a commercial property loan: the valuation and the legal work set the pace. Bridging finance is built to move faster.
- Typical use
- Buying your own premises, buying an investment property, refinancing an existing commercial property loan, bridging a purchase, releasing equity to fund the business
- What you'll need
- Property details, any lease or tenancy schedule, financial statements, your NZBN or company number and photo ID
What it is
What is a commercial property loan?
A commercial property loan is a loan secured by a registered mortgage over a non-residential property: a warehouse, a shop, a suite of offices, an early childhood centre, a bar. Lenders assess it differently from a house. They look at the loan-to-value (LTV), at whether you occupy it (owner-occupied) or let it out (investment), at the strength and remaining length of any lease, and at whether the business can afford the repayment if the tenant leaves.
Bridging finance is the short-term version: a loan for months rather than years, used to buy quickly, to fund a refurbishment, or to bridge to a sale or a longer-term loan. It is faster and more expensive, and it needs a clear exit. Either can sit as a first mortgage, or as a second mortgage behind an existing one where the first lender consents.
The deposit is bigger than on residential property, and the lender lends against the valuation, not the price you agreed. If you already own your premises, the equity in it is often the cheapest capital available to your business.
Worked example
A worked example
- A wholesaler buys the warehouse it has been leasing.
- Legal fees, the valuation, due diligence reports and lender fees all sit on top of the deposit, and GST on a commercial purchase needs checking with your accountant. Your lawyer will confirm the figures.
- The comparison that matters is the repayment against the rent the business is already paying on the same building.
The valuation, not the purchase price, is what the LTV is calculated on, and the two are not always the same number.
Is this right for you?
Is a commercial property loan right for you?
Good fit if…
- You have been renting your premises for years and would rather build equity.
- You have a meaningful deposit available in cash, plus purchase costs.
- The property has a real resale market: standard industrial, a high-street shop, an office suite.
- You need to move faster than a standard loan allows and have a clear exit, which is where bridging fits.
Probably not if…
- You need the money this week. A commercial property loan is not a fast product.
- Your deposit is thin. Lower deposits push you into specialist lending at specialist pricing.
- The property is highly specialised with one likely buyer. Lenders lend against resale, not against your plans for it.
- You are looking at bridging finance with no clear exit. Bridging without a refinance or sale lined up is how short-term debt becomes expensive debt.
What it costs
What a commercial property loan costs
Commercial property usually carries the lowest rate on this site and the highest upfront costs. Budget for both.
- Interest rate
- Rates are set by the lender for your deal, not by us, and depend on your trading, your credit file and the product. A commercial property loan generally prices below unsecured lending. Owner-occupied usually prices better than investment, and bridging prices higher than a term loan, often quoted per month.
- Arrangement fee
- An establishment fee is typically charged as a percentage of the loan and paid at settlement, plus the valuation fee, which you pay whether the deal proceeds or not.
- Legal costs
- You pay your own lawyer and, in most cases, the lender's legal costs too. Bridging lenders may also charge an exit fee.
- Paying it out early
- Many commercial property loans carry early repayment charges, especially on fixed rates. Ask which you are being offered and how the charge is calculated.
Bizzloans is a commercial finance broker, not a lender. The lender that funds your deal pays us a commission, which we disclose to you. You pay us nothing to compare.
Eligibility
Who can apply
- A New Zealand business: limited company, sole trader, partnership or trust
- Photo ID (passport or NZ driver licence) for each director, partner, trustee or owner
- In business for at least 6 months
- Turnover of at least $6,000 a month
- Bad credit considered
- Demonstrated ability to afford the loan, from trading income or rental income
- A property the lender's valuer can value and a lender could resell
Don’t meet these? Talk to us. We have lenders for most situations, and we’ll tell you straight if we don’t.
Contact usWhat you'll need
What you’ll need
No documents
To get a quote
- Nothing. The property type, the price or estimated value, the amount you need and your deposit is enough for indicative numbers.
- We will tell you the likely LTV range before you spend money on a valuation.
Once you pick a lender
To settle
- Property details: the sale and purchase agreement, or title details if you are refinancing
- Any lease and tenancy schedule, if the property is let
- Recent financial statements and tax returns, or bank statements and management accounts on a lighter-documentation case
- Your NZBN or company number, and photo ID and proof of address for each director and guarantor
- Details of any existing mortgage, if you are refinancing or taking a second mortgage
- A valuation, instructed by the lender and paid for by you
How it works
How it works
First
Structure and indicative terms
We work out the LTV the property is likely to support, which lenders have appetite for that property type, and what the deposit and costs actually add up to. You get indicative terms before you spend money on a valuation.
Next
Application and valuation
The application goes to the chosen lender, an agreement in principle is issued, then the valuation is instructed. The valuer's diary is often the bottleneck, and the valuation figure, not the purchase price, is what the final LTV is calculated on.
Last
Legals and settlement
Formal offer, mortgage documents to your lawyer, conditions cleared, settlement booked. Bridging runs the same steps on a shorter clock.
This vs the alternative
Commercial property loan vs bridging finance
Same security, different job. The question is how long you need the money for and how you will repay it.
| Commercial property loan | Bridging finance | |
|---|---|---|
| Term | Years. | Months. |
| Speed | Weeks, set by the valuation and legal work. | Built to move faster. |
| Rate | Lower, usually quoted per year. | Higher, often quoted per month. |
| Repayment | Monthly, capital and interest or interest only. | Often rolled up and repaid in one go at the end. |
| The catch | Bigger deposit, slower process, tighter valuations. | You need a clear exit: a sale or a refinance. |
We will quote both if both are available. If you are thinking of securing business borrowing against your home instead, talk that through with your accountant and family first.
First mortgage or second mortgage
A first mortgage lender is repaid first if the property is sold. A second mortgage sits behind an existing one, which lets you raise money without refinancing the first loan.
- A second mortgage usually needs the first lender's consent.
- It is often quicker than refinancing and avoids early repayment charges on the existing loan.
- It prices higher than a first mortgage, because the lender is second in line.
- What a lender will advance depends on the combined LTV across both mortgages.
How long settlement really takes
A commercial property loan is measured in weeks, not days. Here is the honest order of events so you can set realistic expectations with the seller.
- Application submitted, documents collected, indicative terms issued.
- Credit assessment and agreement in principle. The valuation is instructed once that is in.
- The valuer inspects and reports. This is where most deals lose time, and you cannot rush a valuer's diary.
- Conditions cleared, formal offer, mortgage documents to your lawyer, settlement booked.
FAQ
Commercial Property Loans questions
What LTV can I get on commercial property?
How long does a commercial property loan take?
What is bridging finance?
Can I buy the property in a separate entity?
Do I need to occupy the property?
Can I refinance an existing commercial property loan?
What if the valuation comes in under the price?
Who pays for the valuation?
A person reads this, not a scoring engine
A named advisor takes your file to the lenders on the panel that fund your industry and your turnover, and tells you plainly when a commercial property loan is the wrong answer and what to use instead.
Ready when you are
Compare Commercial Property Loans today
Comparing is free, you’re never locked in, and checking won’t affect your credit score. If we can’t help, we’ll tell you that too.
