Case Studies

Business loan (shop fit out)

Borrowers were the owners of a convenience store in a regional Victorian town.

They needed to upgrade their business with the installation of new shop fittings, adding a larger range of stock and a new line of products.

They were unsuccessful in obtaining appropriate finance from their bank and indeed other business lenders. They approached Eastwood Securities Mortgage Fund staff who identified the upgrades and additional stock would benefit the business and add to profits for the Borrowers.

Eastwood Securities loaned them the required $150,000 at 54% LVR on the security of a mortgage over a vacant block of land.

A commonsense approach with a quick turnaround.

Take out finance and hold stock

Developer completed a Land Division of 10 residential allotments in a Queensland regional centre.

Development finance was at a very high interest rate with profitability eroding due to a lengthy development process during Covid years. The Borrower was rejected finance by banks and alternate financiers due to the LVR and a lack of presales in the regional area.

Eastwood Securities Mortgage Fund was able to refinance the project and provide selling costs and interest with a $1.6mil loan. The Borrower was then able to sell allotments within his price bracket and time frame and repaid the Eastwood facility within the terms of that loan.

Eastwood Securities took a commonsense approach for a successful outcome for all parties.

Luxury Home Completion

Architect/Owner Builder was building a new home in an exclusive metropolitan suburb.

He encountered cost overruns and found himself unable to fund the completion of his luxury home.

His bank, who held the mortgage over his property, refused to provide the required monies and as an Owner/Builder, he was unable to secure alternate funding.

On application to Eastwood Securities Mortgage Fund, we were able to discharge his various borrowings and provide his full funding requirements of $555,000 (40% LVR) on the security of a first mortgage over his home. The building is now complete, and he has been successful in securing a bank Home Loan.

Eastwood Securities Mortgage Fund is a specialist in bridging finance facilities.

Business Start Up

Borrowers operate substantial business enterprises in an Asian country and were seeking to expand their businesses into Australia. They set about acquiring a portfolio of commercial properties in Western Australia to commence their Australian operations. Banks and other Non-Bank Lenders were unable to assist as they perceived that it was a business start-up without an Australian based income.

Borrowers approached Eastwood Securities who were able to assist them with a $6.5m facility to be serviced by the transfer of profits from their overseas operations. Three years later they achieved their objective, and their Australian operations are now online and are income generating.

The Eastwood Securities Mortgage Fund is experienced in solving business challenges even when there are unusual income streams backed by good property security.

Specialist Commercial Borrowings

Eastwood Securities Mortgage Fund received an application for finance from a regional landholder who was seeking funding to develop the infrastructure of a Solar Farm on his property.

The Borrower was unable to secure funding from conventional lenders due to Regional Security Holdings for a specialised project.

Eastwood Securities assessed the loan purpose to be worthwhile and well secured by the value of the land and provided the funding to the Borrower to subdivide part of his rural holdings specifically to develop the infrastructure of the Solar Farm.

The $516,000 funding was secured by a First Mortgage over the Solar Farm site and interest was capitalised to assist cashflow during the period of site development.

The Borrower completed the project over a 2-year period and has now sold the Solar Farm and site to a National Energy Provider, fully discharging the Loan.

Childcare group refinance

Borrower is the owner operator of a chain of highly successful metropolitan Childcare Centres which became heavily affected by the Covid Pandemic.

Illness reduced staff capacity across the board, children were kept at home and trading income was reduced by as much as 50%. Nonetheless, Borrower survived the pandemic and with the assistance of loyal staff were able to stay afloat. Having survived financially the Borrower sought to recapitalise their business and repay the staff for their financial and supportive free overtime.

Unfortunately, banks were not willing to assist, therefore, Borrower applied to Eastwood Securities with an application and request to refinance their regional property assets.

Taking first mortgage security over these assets, Eastwood Securities refinanced all their facilities and provided the funds to satisfy the Borrower’s requirements. At an LVR of 60%, the loan of $1.3mil was serviced over the first six months by capitalised interest and thereafter with monthly interest payments.

Eastwood Securities Mortgage Fund specialises in bridging finance.

Perth Wrecking Yard

Borrowers, for many years operated a motor vehicle wrecking yard from leased premises in an industrial area in suburban Perth. Their landlord advised them their lease would not be renewed as the premises would be sold as a vacant possession. Borrowers found themselves unable to secure alternate premises in the locality in which they had become established for many years and moving would have a substantial detrimental effect on their business.

They decided that their best option was to purchase the site they had been leasing for many years. After many months of unsuccessfully trying to raise finance, they approached Eastwood Securities Mortgage Fund. Eastwood Securities was able to assist with a first mortgage loan of $1.5m at a 65% LVR, and Borrowers have been able to continue their operation successfully, with the loan interest payments being less than the rent they were previously paying.

This is a typical Commercial Loan from Eastwood Securities Mortgage Fund.

Bank policy of termination of rural facilities

Farmers and Graziers who had all their banking facilities with an Australian bank, now faced different banking arrangements. Their bank was the subject of a takeover by a bank that did not have any branches in the area. Borrowers were advised by this bank to make other arrangements, as they did not want to take on their business and the new bank also refused to grant them the usual credit facilities to plant their crop. As a result, the Borrowers were unable to plant a crop and accordingly were unable to harvest for their annual income, which placed them in arrears with their interest payments.

The bank placed the loan in default, however, as a result of Farm Debt mediation, the bank and the Borrowers negotiated a settlement agreement.

Eastwood Securities Mortgage Fund lent the borrowers $950,000 at 45% LVR to pay out the Bank, pay outstanding creditors and provide working capital to sow the current seasons crop. Interest was capitalised into the loan for the first twelve-month term. Borrowers had a bumper season and are now in the process of returning to a major bank.

An excellent example of Eastwood Securities Mortgage Fund bridging loans.

Partially Completed Residential Construction

Applicant is a development coordinator seeking funds to complete a partially built residential property, with a registered building contract in place. Repayment of a second-tier lender that wouldn’t provide required funds to complete was also needed

The security is residential of above average quality in a metropolitan Adelaide beachside area. Formal valuation indicated $2.5mil “As If Complete” and $1.5mil “As-Is”. Taking account of property location, quality, stage of completion, a 70% LVR was agreed.

As a construction loan, we obtained the Building contract, cost to complete summary, building plans & consents, building notifications and inspections, and construction insurance Certificate of Currency.

Tax Returns, Financial Statements & BAS were not available, however Lease & Rental Income for other property owned was provided. A list of all assets & liabilities provided showed additional income generating properties.

While payslips provided for wife along with employment contract for husband showed income, capitalised interest was built into the loan for its six month term.

The exit strategy is to be refinance to a bank or similar once construction is complete.

Rural Residential Property Purchase

Applicant is a professional photographer currently doing limited work due to COVID and wants to purchase a new rural home following loss during recent past bushfires. Insurance did pay-out on prior fire loss.

Key issues are limited income in recent times and wife is on a disability program. Key positive is that the applicant has 60% of purchase price from Insurance payout from his home that was burned down. While there was little financial information available due to last 18 months of COVID, bank statements indicated significant income and $1.2mil in account.

The purchase property (and security) is Rural Residential in the Adelaide Hills. Our formal valuation came in at $1.7mil as per purchase contract (LVR at 43%).

The exit strategy is to be refinance to a Bank once business trading has been consolidated as COVID-19 restrictions ease.

Business Purchase

A family who had been operating a regional motel was seeking to purchase the ‘leasehold’ business using equity in a residential property they owned.

The applicants held security property in suburban Adelaide owned by daughter & parents jointly. A formal valuation at $715,000 resulted in an LVR of 58% for the loan amount required.

Applicants provided leasehold agreement, Motel lease, purchase contract, personal banking statements, business IM and Financials. It was agreed to capitalise interest payments for the loan term in order to provide greater cashflow flexibility in the first year of operation under their control.

Exit is planned to be a refinance to ANZ which is currently under negotiation with broker. An alternative option is sale of another investment property held or sale of the security property if need be.

Home in possession after failed business partnership

A couple mortgaged their home and their investment property with a bank to finance the purchase of a suburban supermarket business, in partnership with relatives.

The business suffered poor trading and partnership disputes leading to the business being closed. The bank subsequently took possession of the couple’s home and investment property.

The couple applied to Eastwood Securities to refinance their bank loan and we were able to pay out the bank with an interest only loan based on the equity in the property and confirmation of restoration of the couple’s income from a return to their former employment.

The couple have now successfully refinanced back to a Bank Loan Package.

Construction Finance for Builder

Licensed Builder who had laid the foundation and the first storey framework of a Residential Investment Property on unencumbered land became ill and was unable to work or continue with construction of the property.

Without income or the ability to continue with the construction the Borrower was looking at having to sell the land in its current state rather than realising the sale of a completed home which would have put the financing of future builds in jeopardy.

With Eastwood Securities providing a prepaid interest only Loan against the value of the land the Borrower was able to subcontract the building work to his sons.

The house was completed and sold at a good profit thus providing welcome funds for the Borrower to assist with getting back on track.

Brewing company required funding to restructure ownership and to reduce ATO liability

50% LVR Interest only bridging loan on Brewery based in Regional Victoria for 12 months to allow owners to restructure the group’s financial position.

The major bank’s would not consider this request in the short term until various financial milestones had been achieved which was estimated to take 12 months.

Borrower’s finance broker arranged the facility in order to assist clients with their long term financial strategy and they appreciated the no fuss attitude and efficient outcome.

Rural Business Recapitalisation

A young couple in rural Australia commenced business as Carriers with capital raised from a Bank on the security of their home to purchase vehicles and equipment.

They had secured a nationwide subcontract delivering specific goods throughout Victoria. The Principal failed and they were not paid for work completed. The loan got 3 months in arrears and their Bank appointed a Liquidator to their Company who in turn seized the Business assets whilst the Bank sought to take possession of their home. Notwithstanding that they had secured a new profitable Contract, they were unable to obtain a release of their securities.

Eastwood Securities provided the required refinance on a 60% lend against their rural home together with a small loan on their parents’ property.

Queesnland company looking for cash out against unemcumbered commercial properties to assist with company restructure

Funds were required by a large Qld private company to assist with restructuring costs to their business.

Directors offered to sell 7 commercial warehouse style properties located in Northern NSW, QLD and Darwin, as they were no longer required.

60% cash out was required to be repaid within 12 months from the sale of these properties with interest capitalised for 12 months from loan proceeds.

Loan settled and the company is now following their restructuring schedule with adequatefunding available to successfully complete the process.

Borrower required funds to subdivide vacant rural/residential land into 9 rural living allotments

Applicant sought $380,000 cash out to assist with the funding of for a nine-allotment subdivision of his freehold vacant rural residential land.

At a 50% LVR the borrower is now able to fund the subdivision process, then sell the off allotments, during the down time in the applicant’s civil company.

Rural Farm owner obtained cash out from Farm property to fund stock and Feed.

30% LVR Bridging Interest only loan on New South Wales Farm on 473 Hectares to assist with stock and feed purchase during drought conditions. Refinance to be arranged in 12 months once income levels have stabilised. Borrower purchased the Farm property in 2017 but had exhausted all her finances with the purchase.

The borrower required further funds to purchase stock and feed at a time when help was required due to the drought conditions and increase stock numbers to increase future income levels.

Once the weather conditions have improved and Income can be demonstrated at satisfactory levels Bank funding will be sought to repay the short-term facility.

Builder looking for funds to complete a partially finished residential property

New South Wales based builder required funds to finalise his 70% completed residential property.

Property valuation was conducted on an “as is” basis with funding of $250,000 advanced to the borrower in one tranche to enable completion on a timeline basis. This loan will be refinanced once the applicant’s 2019 financial statements are completed.

Newly created Residential block in ACT Land Division

Borrowers needed a 70% lend to fund a newly created Leasehold block of land in the ACT. Their intention is to refinance once Building Plans for a residence are finalised via La Trobe.

Eastwood Securities provided the funding to allow adequate time to satisfy La Trobe Lending requirements and secure the land.

1. Borrower required bridging development site funding in Darwin

Borrower sought to refinance expiring Private loan $1.5m plus assist with Development funding for a further Property Development in Darwin CBD total $2.39m inclusive of oneyear’s capitalised interest.

Security is a vacant Commercial site in the Darwin CBD, approximate 50% LVR.

Borrower is now free to hold the site until Development timing is considered satisfactory whilst also being able to continue with a pending project also in Darwin.