Buying a Pub? Urgent Short Term Finance to Settle on Time
Settle on the freehold pub on time, then move to a bank loan once you are trading
Experts in strategic, short-term finance
Buying a pub involves more steps than most property purchases: the freehold, the liquor licence transfer, gaming approvals where they apply, and the staff and suppliers. When settlement is close and the bank is still working through its assessment, we can fund the purchase in as little as 24 hours.
We lend to publicans and hospitality groups buying freehold pubs across Australia. The loan runs for 1 to 24 months, which gives you time to trade the venue, build a trading history under your ownership and refinance to a bank.
What we can fund
- •The purchase price of a freehold pub, or the part the bank will not cover
- •Stamp duty and settlement costs
- •Opening stock and working capital for the first months of trading
- •A refurbishment of the bar, dining room or accommodation after settlement
- •A leasehold pub business, using a property you already own as security
Why banks take longer with pubs
Banks treat pubs as specialised property. The valuation is done on a going-concern basis, which means the valuer reviews the trading figures as well as the land and building, and only a small number of valuers do this work. Bank credit teams also ask for several years of trading figures. All of this takes time, and the settlement date in the contract does not always allow for it.
We lend against the freehold property, valued on a going-concern basis. Our valuers are in house, so the assessment does not wait in a panel valuer's queue, and we focus on the property value and your plan for refinancing.
When publicans call us
- •The bank has approved the loan in principle, but its valuation will not be ready by settlement
- •The seller has offered a lower price for a short settlement
- •You are buying another venue before the last one has been refinanced
- •You have exchanged, and the bank has added conditions you cannot meet before settlement
- •You would rather settle now and refinance once the venue has traded under your ownership for 6 to 12 months
Steps to settlement
Day one. Send us the contract, the trading figures from the seller and a summary of your hospitality experience. Our indicative offer usually follows within hours.
Valuation. Our in-house valuers inspect the pub and review the trading figures.
Letter of offer. Once you accept the terms, we issue the letter of offer straight away and work with your solicitor so settlement lines up with the licence transfer.
Settlement. After you sign the terms, settlement can follow within 24 hours.
What to send us
- •The contract of sale for the pub
- •The seller's trading figures, ideally for the last two to three years
- •A summary of your hospitality experience, and of the licensee who will run the venue
- •Details of any other property you own, if you need to borrow more than 70% of the pub's value
- •Your refinance plan: a bank that has shown interest, or the sale of another property
Loan options for pub buyers
- •First mortgage: over the freehold pub property
- •Second mortgage: over your home or an investment property, to add to the loan
- •Bridging loans: to settle before the bank is ready
- •Secured business loans: for opening stock, working capital and a refurbishment
- •Secured business line of credit: for cash flow in the first months of trading
Loan terms for pub purchases
| Loan feature | Detail |
|---|---|
| Loan size | $250,000 to $10,000,000 |
| Interest rate | From 9.7% p.a. on a first mortgage, from 11.95% p.a. on a second mortgage |
| Term | 1 to 24 months, interest only |
| Maximum LVR | 70% of the lower of the assessed value and the purchase price |
| Security | A first mortgage over the freehold pub property, valued on a going-concern basis. Other property can be added as extra security |
| Settlement | From 24 hours |
Repaying the loan
Most publicans repay us by refinancing to a bank once the venue has traded under their ownership for 6 to 12 months and the bank can see the results. Some sell another venue or property instead. We agree the plan with you before settlement and set the term to match it.
Hospitality loans we have funded
“Pub purchases often need to settle before the bank has finished its work, because the licence transfer and the seller set the date. We look at the freehold, the trading figures and the buyer's experience running venues. If those are sound, we can settle quickly and give the buyer time to refinance with a bank.”
Gino Tabila
Associate Director
Frequently Asked Questions
Get an indicative offer within hours, not weeks.
No credit check. No obligation.
Why Secured Lending?
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Get an indicative offer within hours, not weeks.
No credit check. No obligation.
Why Secured Lending?
Are you a broker? Find out why brokers love working with us.
Other Urgent Loans We Fund
Each page covers one deadline: what we fund, what to send us and how quickly we can settle.