Quick snapshot:
- Loan Type: Private Second Mortgage (Business Purpose)
- Amount: $1.3 million
- Security: Multiple industrial properties in Bankstown, NSW
- Challenge: Group refinance delayed due to unresolved ATO tax arrears
- Solution: Fast-tracked second mortgage from Secured Lending cleared the tax debt and enabled refinance
A property investor and business owner with a portfolio of industrial sites in Bankstown was on the verge of finalising a multi-property refinance when a familiar but formidable issue reared its head: a substantial outstanding tax debt with the Australian Taxation Office. The refinance was critical to free up working capital and restructure high-cost debt across the group. But the moment lenders saw the unresolved tax obligations, the deal ground to a halt.
Tax debt is a common but deeply misunderstood impediment in commercial refinancing. Traditional lenders typically view it as a red flag, treating it as a sign of poor financial management or underlying distress. Once flagged, it often triggers strict credit conditions, declines, or substantial delays. For this borrower, the ATO debt had created a bottleneck across the group, endangering settlement timelines and risking costly fallout with other finance commitments. Urgency was high, and conventional funding channels were not equipped to respond.
Addressing the Tax Roadblock with a Rapid Second Mortgage
Enter Secured Lending, specialists in short-term, business-purpose funding. With a full understanding of the nuances of tax debt and how it impacts credit decisions, our team assessed the client’s equity position, existing mortgage structure, and the broader group refinance strategy. We structured a second mortgage facility totalling $1.3 million, secured against two of the client’s industrial assets in Bankstown.
The process moved swiftly. Valuations and legal due diligence were expedited, and within a short window, funds were made available to clear the outstanding ATO liabilities in full. This unlocked the original refinance plan, allowing the client to re-engage their mainstream lender under clean conditions, with the tax issue entirely resolved.
One of the key advantages of working with Secured Lending was the flexibility offered. Unlike many private lenders who insist on rigid minimum loan terms, we tailored the second mortgage to fit the client’s projected refinance timeline. Our product allowed for early repayment without punitive fees, enabling the borrower to settle our facility once the primary refinance concluded.
Why Businesses Choose Secured Lending for Second Mortgages
The second mortgage market is often seen as a fallback. But when structured properly, it becomes a strategic bridge. At Secured Lending, we understand that timing and flexibility are more important than ever for business owners dealing with tax stress or cash flow shortfalls. Here’s what differentiates us:
- Speed: We routinely settle in under 48 hours, and in urgent cases, same-day approvals are possible.
- Custom Terms: We don’t lock borrowers into inflexible loan periods. Our facilities are designed to be repaid on your terms.
- Business Focus: Our expertise lies in commercial loans including caveat loans, bridging loans, and first and second mortgages.
- Real Solutions: We work closely with borrowers and brokers to create viable outcomes under pressure.
The Bankstown client’s experience is a perfect illustration of how targeted, short-term lending can act as a pressure valve. With mainstream funding blocked, a $1.3 million second mortgage provided immediate relief and kept the broader finance strategy on course.
What Are the Options When Refinance Is Blocked by Tax Debt?
It’s a question we often hear from brokers and business owners alike: “What can we do when our bank won’t proceed due to an ATO debt?”
The key is to think creatively and act quickly. A well-structured second mortgage can provide the breathing space needed to address tax arrears without losing momentum on a critical refinance or business expansion. Secured Lending specialises in these types of time-sensitive scenarios, providing access to capital when it’s most needed.
If your client is facing lender resistance due to unpaid tax or legacy debt issues, our team can step in with a pragmatic, fast funding solution to bridge the gap. Whether it’s $300,000 or $3 million, we tailor second mortgage loans that move as quickly as the challenge demands.
Secured Lending remains committed to helping business owners resolve financing roadblocks through thoughtful, responsive lending. If you or your client is dealing with tax-related delays, reach out to see how we can support you through it with confidence and speed.
