Commercial Interest Rates

[King13]

Hi - can someone give an idea about fixed and floating commercial loan interest rates?

We have had variable rate mortgage for some time and interest has been about 5.3 - 5.6 %.

Cheers.

[Beano]

Hi - can someone give an idea about fixed and floating commercial loan interest rates?

We have had variable rate mortgage for some time and interest has been about 5.3 - 5.6 %.

Cheers.

Best i have heard of is floating 3.7% with HSBC but you do need to your have your residential with them
My commercial is a lot higher at 4.2pc floating BNZ. Westpac was priced at 4.1pc . ASB also 4.1pc
Just some quick question
1: Loan under or over $25m
2: Portfolio under or over $50m
3: LVR under or over 50pc
4: WALT under or over 5yrs
5: P & I under or over 12yrs
6: Interest cover by Net Rental under or over 2.5 cover

[King13]

Best i have heard of is floating 3.7% with HSBC but you do need to your have your residential with them
My commercial is a lot higher at 4.2pc floating BNZ. Westpac was priced at 4.1pc . ASB also 4.1pc
Just some quick question
1: Loan under or over $25m
2: Portfolio under or over $50m
3: LVR under or over 50pc
4: WALT under or over 5yrs
5: P & I under or over 12yrs
6: Interest cover by Net Rental under or over 2.5 cover

Thanks Beano

- Loans about $3m (so long way from $25m)
- Portfolio of $5-6m
- LVR about 64%
- WALT over 5 years
- P&I about 12 years
- Interest cover by net rents about 2.5

Wondering if banks offer fixed term for commercial loans.

Where are you based? Would like to meet some time and get advice.

[DaveW]

Yes banks offer fixed term for commercial loans, just as they do residential.
Your bank lending manager will give you your options, and you should also ask a commercial lending broker such as Strata Funding.

[King13]

Thanks, DaveW.

Will ask the manager to see what they offer. Cheers.

[Davo36]

Yes banks offer fixed term for commercial loans, just as they do residential.
Your bank lending manager will give you your options, and you should also ask a commercial lending broker such as Strata Funding.

What sort of interest rates do Strata Funding charge DaveW?

Just for normal commercial property investment I mean.

[DaveW]

They are broker Davo. They will source funding at prevailing rates.

[DaveW]

Additionally they source second tier lending. Keep them on file for when the market tanks and the lowering of interest rates cannot continue to prop up the property market then it's brokers like these that are a useful source of funds.

[Rosco]

Hi King13,

Why do you have $3 million on floating?

Whether commercial or residential, you can normally save around 1% by fixing.

Some then say, "but I think interest rates might go down and I want to be ready to act". If so fix for 6 months. But in generally these people are still floating 1 year later and have just paid an extra 1% than they should.

Ross

[King13]

Thanks, Rosco.

We've just continued with this over time as it allows adjustment with cashflow. But with the lower interest rates, it may be time to fix.

[JBM]

From my small time commercial lending sub 1mill I was told by my business banker that while I have residential or the like equity I can secure Res rates ie 4% etc but unsecured commercial lending would be around 2% higher on average aka 7% floating .. I have spoken with the likes of SBS BNZ and their rates are even high 9% ?????

[nick000]

Depends on the deal. Bnz seem a bit tight on commercial at the moment. Anz are doing 6%

[JBM]

Depends on the deal. Bnz seem a bit tight on commercial at the moment. Anz are doing 6%

Yes has changed a lot over the last few months if I could come up with 50% equity I could get low 4% Commercial rates 1-2yr fixed term etc

[Wayne]

Thanks, Rosco.

We've just continued with this over time as it allows adjustment with cashflow. But with the lower interest rates, it may be time to fix.

You may need to structure the loans - split into at least 2 - one fixed and one floating to cater to the cash flow.

[Beano]

BNZ floating commercial is now 3.86pc