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Picking up on Mark’s comment about commercial property being viewed as higher risk because of its specialised nature:
Low doc/No doc loans are now available up to 90% of the properties value (the non conforming version) or 76% on Mortgage Insured Products (most of the market). These are predominantly written by lenders who don’t have commercial divisions – thus the first impediment to commercial security. The second reason, in view of the Low doc LVRs is that the maximum standard LVR on commercial security is 70% (compared with 95 – 110% on prime residential). This is because of the greater risk involved with commercial property from a mortgagee sale point of view.
That said the non conforming sector of the Australian market is growing exponentially. It wouldn’t be a surprise to see Low docs written on other than standard residential security in the not so distant future.
