Commercial property loans explained, for business owners buying their own premises

When a business buys its own premises, the lender looks at the building and at the business that will run from it. How much a lender will lend, what deposit it asks for and which papers it wants depend on the lender and on how the building will be used. This guide walks through what a broker looks at before an application goes in.

Current as at October 2026.

What does a lender look at first?

The building is the security, so the lender will want to know what it is worth and how easily it could be sold. A valuation is normally part of the file, and the figure the lender uses can differ from the price in the contract.

The business is usually the one making the repayments, so the lender will also look at how the business earns its income and whether its cash flow covers the loan.

Is the building owner occupied or an investment?

This matters more than most owners expect. An owner occupied building is one the business uses for its own operations. An investment building is leased to someone else. Lenders can treat the two differently, with different maximum loan to value ratios and different documents, so the answer changes which lender suits the file.

If the business is only going to use part of the building, tell the broker at the start. The split changes how the file is written up, and it is easier to set that out before the application than to change it afterwards.

How much deposit will a lender ask for?

There is no single answer. Deposit and loan to value ratio limits vary by lender and by property type. Some lenders are stricter with specialised premises than with a standard warehouse or office, and some will look closely at how long the business has traded before they agree a figure.

The practical step is to ask each lender for its current policy in writing, rather than relying on a figure from an earlier conversation or a web page. Policies change, and a figure that was right a year ago may not be right for a file being written today.

What financial documents will a lender ask for?

Expect the lender to ask for the business’s recent financial statements and tax returns. If the business is run through a company or a trust, the lender may also want the accounts of that entity. Many lenders also ask for current year management accounts, so they can see how the business is trading now.

The exact list depends on the lender and on how the business is set up. Have the figures ready before the first meeting, because missing papers can slow a file down. Your accountant is the right person to pull them together.

What about buying through a related entity and leasing back?

One option is to buy the building in a separate entity and lease it back to the trading business. That can work well, but the lease becomes part of the lending file. The lender will want to see the lease itself, the rent, the length of the term and who the tenant is.

Lenders generally assess whether the rent can carry the loan, so a rent that is set without thought can cause trouble later. The lease and the structure should also be checked with your accountant before you commit, because they affect tax and the business’s position as well as the loan.

Does the business structure change the loan?

It can. A company, a trust, a partnership and a sole trader each carry different liability and different documents. The borrowing entity and who carries personal liability for the loan are set out in the loan documents, so the structure should be settled before the application goes in.

Changing the structure after an offer is made can mean starting again with the lender, which takes longer.

When should a family business talk to a broker?

Early, and ideally before a contract is signed. Starting early leaves room to shape the deposit and the lease to suit the lender.

Loan Lounge works with a panel of 75+ lenders, and a broker can tell you which of them will look at this kind of file and what each one is likely to want from the business. Our process starts with an initial consultation, then strategy and research, then the application and approval, and finally settlement and ongoing support. If you are weighing up a premises purchase, book a commercial lending call before the contract goes in.

It’s fair to ask how any broker is paid. The Moneysmart guide to using a mortgage broker sets out that brokers must act in your best interests and tell you about commissions. The MFAA’s page on how brokers are remunerated sets out how upfront and trail commission work. On most residential lending, the lender pays the broker and not the customer. Terms for commercial lending can differ, so ask us directly.

For related reading, the main types of commercial loans and the difference between owner occupied and investment loans cover the basics.

This is general information only. It doesn’t take your objectives, financial situation or needs into account and isn’t financial, tax or legal advice. Whether a purchase suits your business, and how it should be structured, is a matter for your accountant and a licensed financial adviser. Loan Lounge, ACL 515608.

Frequently asked questions: commercial property loans for business owners

Can a business borrow to buy its own premises?

Yes. The lender assesses both the building and the business, and the terms vary by lender. Start the conversation before the contract is signed.

Is an owner occupied loan the same as an investment loan?

No. The building’s use changes which policies apply and what the lender asks for, so check each lender’s policy for the type that matches your building.

Do I need my accountant before I speak to a broker?

Not to start the conversation. The lender will want the business’s financials, so have your accountant’s recent figures ready when you do.

Book a commercial lending call and we can look at the structure with you before anything is signed.

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