Secure Your Business Future with a Fixed-Rate Business Loan 

Are you seeking financial stability and a competitive interest rate for the long term? Discover the benefits and nuances of fixed-rate business loans to make informed decisions that safeguard your business interests. 

Understanding Fixed-Rate Business Loans: 

Fixed-rate business loans offer the assurance of a consistent interest rate over an extended period, shielding you from market fluctuations. This stability is particularly advantageous when you secure a competitive interest rate during the fixed term. 

Key Features: 

• Fixed Term Duration: Typically ranges from one to five years, ensuring a steady interest rate during this period. 
• Interest Rate Lock: Your interest rate remains unchanged, regardless of shifts in the Reserve Bank of Australia’s (RBA) cash rate. 
• Extension Option: Some lenders may allow an extension of the fixed-rate term for an additional five years, subject to your financial situation and repayment history. 
• Loan Amount: Borrow from $250,000 to up to $50,000,000, with loans over $5 million subject to stricter assessments. 

Loan Repayment Example: 

Consider a loan of $700,000 with a fixed rate of 4.25% for five years. Your monthly fixed repayments would be $1,520, providing financial predictability irrespective of market fluctuations. 

Loan Features to Consider: 

Tailor your fixed-rate business loan with features such as: 

• Overdraft Facility: Obtain an overdraft facility with an acceptable property as security, subject to a credit score assessment. 
• Interest-Only Option: Explore interest-only features for up to five years, though it’s important to note that during this period, you’re not paying off the principal. 
• Line of Credit (LOC): Some lenders offer a line of credit for low-risk applicants, providing a high limit based on your application. 
• Redraw Facility: Access a redraw facility to withdraw any additional funds paid in advance, subject to lender requirements. 
• Offset Account: Benefit from a 100% offset account to pay off your loan sooner and save on interest expenses. 

Suitability of Fixed-Rate Business Loans: 

While business loans lack regulation under the National Consumer Credit Protection (NCCP) Act, lenders may exhibit flexibility in their policies. Successful applications often hinge on: 

• Investment: Demonstrate the amount of capital invested. 
• Experience: Showcase your business acumen and experience. 
• Business Type: The nature of your business is a consideration. 
• Security: The property offered as security plays a vital role. 

Cautionary Considerations: 

While a fixed-rate business loan provides stability, refrain from fixing your interest rate if you anticipate: 

• Selling the business or property. 
• Making significant lump sum repayments. 
• Switching lenders or seeking another business loan shortly. 

Note: The information provided is general; it is advisable to seek independent advice from legal professionals before financing your business. 

Refinancing Possibilities: 

Explore the option to refinance your business loan to another lender with more competitive rates. This strategic move can result in substantial savings, but careful planning is essential. 

Finding a Great Deal: 

Lenders typically don’t publicize their best rates for business loans, emphasizing a case-by-case assessment. Negotiate rates based on your loan size, lender choice, and the strength of your application, recognizing the uniqueness of each financial scenario.