Hi guys,
I have one of my commercial loans coming up for option to go variable and was wondering what sort of rates are fair atm?The banker is telling comm rates havent dropped much due to they are not all sourced from the RBA.But i was expecting at least a drop to low 8% or high 7s.
I also understand it varies greatly depending on security and risk etc etc ,so just yr thoughts atm generally?Thanks alot
Luke
Luke Taylor | Hope Property Investing
http://hopepropertyinvesting.com
Email MeProperty Support,Strategist and Buyers Agent
Hi Luke,
yes you are correct, the type of security will differ the interest rate you are able to secure greatly. But generally on variable 7-10% are common.
You should also consider a fixed rate, becuase ATM you can source these in the low to mid 5's for 1-3 years. Depending on the loan amount.
Your broker should be able to source the right facility for you.
Ok i am back from the USA anyone miss me …..
WC the fall in official rates has been passes on % for % in the Commercial market as many lenders have withdrawn totally from this type of lending.
In saying this it all depends on the security involved as it is an area that lenders can certainly price in the risk.
If you are referring to a $400,000 retail shop then the rate has fallen considerably however if it is a 12 town house complex with high GR lend with no pre-sales then the rates have not fallen hardly at all.
Ok quick jetlag sleep and will be back in to answering more questions and catching up on emails.
Richard Taylor | Australia's leading private lender
Ok i am back from the USA anyone miss me …..
WC the fall in official rates has been passes on % for % in the Commercial market as many lenders have withdrawn totally from this type of lending.
In saying this it all depends on the security involved as it is an area that lenders can certainly price in the risk.
If you are referring to a $400,000 retail shop then the rate has fallen considerably however if it is a 12 town house complex with high GR lend with no pre-sales then the rates have not fallen hardly at all.
Ok quick jetlag sleep and will be back in to answering more questions and catching up on emails.
Richard Taylor | Australia's leading private lender
World changer you can get lower than 8%, I fixed at 6.4% last week and now there has been another interest rate drop so its probaly under 6% now, I heard rooma about 6.69% for 5y fixed i wish i got that one but never mind
Thanks guys ,
appreciate yr thoughts .I went variable for now but will prob fix it with the next drop in jan or feb at around 5% hopefully haha,these times are good
Luke Taylor | Hope Property Investing
http://hopepropertyinvesting.com
Email MeProperty Support,Strategist and Buyers Agent
Taking into account the Commercial lending landscape in recent times, the fairest rates at the moment are anything under 10%
Focus more on finding a funder that actually has money, and save yourself the unnecessary heartache of valuation fees and application costs chasing the bottom dollar rate.Go where the money is.
Consider fixing for 1 year at about 5.5 – 5.6% and when the fixed period expires you may find yourself in a lower interest rate period so then you can fix it for longer.
Current variable rate for commercial is around 8% so it just depends how far you think the variable rate will go down by (if it will go down).
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