How a $300,000 Second Mortgage Supported a Small Business Restructuring and Rescue

Hutch

Over $400 million in business loans Australia-wide.

Using a 2nd Mortgage

Quick summary:

  • Loan amount: $300,000 second mortgage

  • Loan type: Second mortgage on investment property

  • Location: Not disclosed (Australia)

  • LVR: Not specified

  • Problem: Profitable business burdened by sudden tax debt and mismanagement

  • Solution: Fast $300,000 capital injection through second mortgage to support SBRP and creditor payments

When a previously profitable business came under pressure due to mismanagement and rising tax debts, a second mortgage became the financial bridge that helped steer the company back on course.

The business was operational, with a strong client base and consistent revenue. But a recent management change had a serious impact. The new General Manager had deprioritised the firm’s financial obligations, resulting in a mounting tax bill and unpaid trade creditors. It didn’t take long for the situation to spiral. The business owner, committed to keeping the doors open and staff paid, suddenly faced the reality of looming insolvency.

In this scenario, many business owners might assume their options are limited. Banks were unwilling to extend new credit given the unsettled tax debt and internal disorder. Yet, the fundamentals of the business remained strong. What it needed was an immediate injection of capital to stabilise operations and support a Small Business Restructuring Plan (SBRP).

Second Mortgage: A Strategic Lever in Restructuring

That’s when Secured Lending was engaged. After a detailed review of the business’s financials and the restructuring plan, we identified a viable pathway: a $300,000 second mortgage secured against an investment property owned by the director.

This funding was approved and settled quickly. The purpose of the loan was twofold: firstly, to pay off a significant portion of the tax debt, demonstrating a serious commitment to the ATO and enabling the SBRP to proceed. Secondly, to re-capitalise the business so it could meet urgent obligations and continue operating while the restructuring took effect.

One of the main advantages of using a second mortgage in such cases is access to capital that traditional lenders won’t consider. It can be the difference between shutting the doors and turning the ship around. Our second mortgage terms are tailored to support short-term scenarios like this—with a practical exit strategy aligned to the business’s recovery timeline.

Why Second Mortgages Can Be a Game-Changer in Business Restructuring

This case offers a clear example of why second mortgages can be a useful tool in business restructuring:

  • Fast access to capital: We approved and released $300,000 within days, giving the client time-critical breathing room.

  • Security-backed lending: With the investment property used as collateral, we could offer a loan that was not reliant on the business’s day-to-day financial health.

  • SBRP alignment: Funds were deployed in line with a clear restructuring strategy, balancing debt repayment with operational stability.

Could a second mortgage help save your business if you’re restructuring under pressure from the ATO?

A Call to Insolvency Practitioners and Debt Advisors

At Secured Lending, we regularly support accountants, restructuring practitioners and insolvency professionals working with clients under pressure. When a business is viable but cash-starved, and time is limited, second mortgages offer a fast and flexible option to support SBRP outcomes.

If your client has property equity, even in an investment asset, that untapped capital could be key to resolving a temporary crisis. Our role is to deploy funding quickly and constructively so businesses can implement their restructuring plans and return to sustainability.

We specialise in short-term business loans and our core lending products include:

  • First Mortgage Loans

  • Second Mortgage Loans

  • Bridging Finance

  • Caveat Loans

  • Short-Term Business Loans

Secured Lending works swiftly and discreetly with advisors and clients to ensure funding is available when it’s needed most. If you’re helping a business in distress, we’re ready to step in with practical finance solutions that support your strategy.

Speak with our team today on 1300 795 175 or email info@securedlending.com.au to discuss how a second mortgage could play a vital role in your next restructuring engagement.

 

Picture of Gino Tabila

Gino Tabila

Associate Director - Secured Lending

Picture of Mark Hutchins

Mark Hutchins

Director - Secured Lending

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Using a 2nd Mortgage

Why Secured Lending?

  • With over 250 clients, we’ve serviced over $400 million in loans Australia-wide.
  • We use our own funds and have our own internal property valuation team. This means we move fast.
  • We can settle caveats, 1st and 2nd mortgage loans within 24 hours up to $45m.
  • We pride ourselves on being transparent and honest in our approach, always aiming to have an initial assessment back to you in a few hours.
  • Our rates start at 9.95% p.a. with loan terms from 1 – 24 months. 

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