Quick summary:
Loan Type: Second Mortgage Loan
Loan Amount: $800,000
Location: Pyrmont, NSW
Purpose: Urgent tax debt settlement to prevent refinance collapse
Solution: Fast-settled second mortgage across multiple properties
When a refinance is on the line and the ATO is knocking, there isn’t time to wait for traditional lending pathways to catch up. That was the situation one of our clients faced: a large property portfolio in Pyrmont and an imminent refinancing arrangement jeopardised by an $800,000 outstanding tax debt.
The problem wasn’t viability. The client had strong equity, a clear business case, and favourable terms ready on the other side of the refinance. But the tax debt triggered concerns with the new lender. If it wasn’t cleared fast, the refinance would fall apart. Delays would mean higher costs, loss of favourable terms, and possible fire sale asset disposal.
That’s where we stepped in. At Secured Lending, we provided an $800,000 second mortgage facility secured across multiple Pyrmont commercial properties. It was structured and settled rapidly – giving the client immediate access to the capital required to clear their ATO obligations.
What is a Second Mortgage Loan?
A second mortgage is a loan secured against property that already has an existing mortgage on it. It sits behind the first mortgage on title, which means it carries higher risk for the lender and typically attracts higher rates. But for business borrowers with strong equity and urgent funding needs, it’s one of the fastest ways to access substantial capital.
Second mortgages are particularly valuable for complex lending scenarios where banks or traditional lenders either won’t act fast enough or will decline the loan altogether because of timing, credit blemishes, or non-conforming income documentation.
In this case, the client’s existing first mortgage was unaffected. Our second mortgage allowed them to resolve the urgent issue (tax debt), unlock the refinance, and ultimately secure a better long-term position. All without interrupting business operations or needing to sell assets.
Why Use Second Mortgage Finance to Settle Tax Debts?
ATO tax debts can emerge quickly and with little warning. Whether from cash flow mismanagement, unexpected downturns, or administrative oversights, they carry serious consequences if not addressed swiftly. Once the ATO flags a debt as outstanding, it can:
Issue garnishee notices on business income
Register a caveat on properties
Freeze bank accounts
Prevent refinances from being approved
That last point is often underestimated. Many clients only discover how critical their tax position is when a refinance or restructure is suddenly declined at the last minute.
For this client, an $800k tax debt was enough to delay their refinance and put an entire portfolio strategy at risk. Without the second mortgage solution, they were looking at steep penalties, missed deadlines, and possible default.
Second mortgage finance solved that problem – quickly, efficiently, and without the red tape. In less than a week, the tax debt was settled and the refinance went through.
When Second Mortgages Make Sense for Business Borrowers
Second mortgage loans aren’t for everyone. But they make strategic sense in certain business scenarios, such as:
Urgent ATO tax debt settlements
Bridging finance between property sales and purchases
Cash flow for business expansion or operational restructuring
Paying out creditors to avoid liquidation
Meeting settlement deadlines on time-sensitive deals
The key advantage lies in speed. Because second mortgages are asset-backed, they can be arranged in days, not weeks or months. This makes them ideal when traditional lenders stall or won’t assist due to risk profile, document requirements or tax arrears.
What Makes This Case Unique?
This wasn’t just about helping someone get a loan. It was about enabling a long-term financial strategy that was stuck on a short-term problem.
The client had a refinance strategy ready that would improve their interest rates, streamline their portfolio, and reduce their holding costs significantly. But they couldn’t get there until the tax debt was paid. Our second mortgage product became the bridge that allowed them to cross that gap.
Ask yourself: Can a second mortgage really save a refinance in crisis?
In this case, the answer was yes. And that’s precisely what Secured Lending exists to do. We specialise in short-term business finance that works when the banks won’t. Our lending products include:
If you or your client are navigating tax arrears, need a fast refinance rescue, or are up against a funding deadline with no flexibility from traditional lenders – reach out to us. Call 1300 795 175 or email info@securedlending.com.au to speak with our expert team today.
