Finance Product

Fastest Caveat Loans in Australia

Caveat loans are typically arranged between an investor/ funder and a borrower in the form of a legal arrangement called a mortgage.

The amount borrowed is secured against their real property and secured in the caveat the lender is assigned to the caveat to secure the caveat loan.

Caveat loans are most commonly used for a myriad of purposes.

Caveat loans can also be used by established businesses who want to raise finance without involving a commercial bank.

Because caveat loans are secured against the borrower’s equity, caveat loans typically carry a higher interest rates than borrowed from commercial banks.

Caveat loans have been used in Australia to fund business start-ups, investments in property development, hotel/motel developments, restaurant developments, and many other types of businesses over the last ten years. Caveat loans can be used to refinance existing mortgages; caveat lenders will often offer reduced interest rates for refinancing.

Caveat loans are shorter-term solutions and caveat lenders lend over 3-6 & 12 month terms

How are Caveat Loans Secured?

  1. When a ‘caveat’ is placed onto a property title, it ensures the lender of interest is registered on the property; similar to how mortgages are recorded.

  2. In Australia, a caveat loan is made to purchase a property that the lender later uses as security for the loan. The lender receives an equitable interest in this property. They can be confident to proceed with the lending transaction with the assurance that they’ll be able to understand liquidate the property to make up any losses in case of default from the borrower.

  3. A caveat in Australia is a legal note that lets other lenders know the property is being used as collateral for a loan. The home can’t be used for any other transactions.