Quick answer
A $1 million secured business loan is typically a first mortgage over commercial property, an unencumbered home or several properties together, or a second mortgage behind a modest bank loan on a high-value property. It funds property purchases, acquisitions, development sites and refinances. It is assessed on the security and a well-evidenced exit, with no valuation needed before approval.
Key points
- Commonly a first mortgage over commercial property or several properties
- Funds purchases, acquisitions, development sites and refinances
- Exit evidence is reviewed closely at this level
- Settlement may involve several titles and parties
- Interest prepaid or capitalised keeps cash flow free
The million-dollar threshold
A seven-figure secured loan is a significant transaction, but in property terms it is common. Many commercial buildings, industrial units and family homes in Australian cities carry enough value to support it. What changes at this level is not the basic process but the depth of attention given to each element: the security, the title, the purpose and especially the exit.
Typical uses
- Buying commercial or industrial premises when the bank cannot settle in time. See commercial property loans.
- Buying a business or a competitor’s assets. See business acquisitions.
- Securing a development site before approvals or construction finance are in place. See development site purchases.
- Refinancing a maturing bank or private facility.
- Major tax or creditor settlements that must be paid in one amount.
How $1m loans are usually secured
| Security approach | Typical scenario |
|---|---|
| First mortgage over commercial premises | The business owns its building with little or no debt |
| First mortgage over an unencumbered or lightly geared home | Directors with significant home equity |
| Second mortgage behind a bank on a high-value property | A large home or building with a modest first mortgage |
| Multiple properties | Combining several titles to reach the amount at a sensible LVR |
At this size, many deals use more than one property. Each title is searched, each owner signs, and the combined LVR is what matters.
The exit under the microscope
For a $1m loan, lenders want to understand the exit in detail. If the exit is a bank refinance, what will the bank need and when? If it is a sale, what does recent evidence say about price and time on market? If it is a payment, who is paying and what is their track record? A one-page summary that answers these questions can make the difference between a fast yes and a slow maybe. See our guide on exit strategies lenders accept.
Have a specialist review your $1m deal before you sign a contract.
Settlement logistics
Larger loans often involve more parties on settlement day: existing lenders being repaid, a vendor’s solicitor on a purchase, third-party security providers, sometimes the ATO. Most settlements now run electronically, which coordinates payments and registrations, but each party has to be ready. Allow a few business days from signed documents and keep everyone informed of the target date.
Cost and interest at this level
Every loan is priced on its facts: security position, LVR, property type, term and exit. At $1m the total cost in dollars matters a great deal, so compare offers on the full cost over the realistic term, not on any single figure. Interest can be prepaid or added to the loan. The bridging cost estimator shows peak debt and what is left at exit.
An illustrative $1m loan
Illustrative only. A food manufacturer has outgrown its leased factory. A freehold industrial building nearby is offered off-market with a short settlement. The company has a large deposit but its bank needs updated accounts and a valuation before it can approve the balance. A $1m private first mortgage over the new building, supported by a second mortgage over a director’s investment property, settles the purchase on time. Four months later the bank refinances the building, repaying the private loan, and the second mortgage is discharged.
Due diligence you should do
- confirm GST and transfer duty on any purchase with your adviser
- check zoning and permitted use for commercial premises
- review any leases that come with the property
- confirm the refinancing lender’s requirements early if that is the exit
- make sure every property owner understands the security arrangement
Moving up or down
For smaller amounts see $500k loans; for larger, see $2 million loans.
Structuring across entities
Larger loans often involve more than one entity: a trading company that needs the funds, a property trust that owns the building and directors who own homes. The borrower is usually the entity using the money, with the property owners signing as security providers and the directors as guarantors. Getting the structure right at the start avoids redrafting documents later. If your group has several entities, sketch the relationships on one page for your specialist.
When a bank is still the better answer
If you have time, current financials and a property the bank likes, a bank loan will usually be cheaper over the long term. Private finance at $1m earns its place when time, policy or circumstance rules the bank out for now. Many borrowers use both: private funding to secure the opportunity, then a bank refinance to hold it long term.
A million-dollar decision, made with clear numbers
At this level, clarity is everything. Tell us the purpose, the properties available as security, the existing debts and the exit, and a specialist will tell you whether the deal works and how to structure it. Making an enquiry involves no credit check, your information stays with our team, and complete details let us give you a confident answer rather than a guess. Discuss a $1m loan.
Frequently asked questions
What property secures a $1m business loan?
Often a commercial or industrial building, a high-value home, or a combination of properties whose total equity supports the loan within the lender's combined LVR.
Can a $1m loan be approved without financial statements?
Often with fewer documents than a bank needs, because the decision rests on security and the exit. Some supporting information on the business and the exit is still required.
How long does a $1m loan take to settle?
Straightforward deals can move quickly, but loans involving several titles, existing lenders being repaid or third-party security providers usually take a few business days from signed documents.
What exits are acceptable at $1m?
A property sale, a refinance to a bank or another lender, a business sale, or a known incoming payment. The more evidence, the stronger the deal.
Prefer to start now? Enquire here
About 60 seconds. No credit check when you first enquire, and a secured lending specialist calls you back.