If you’re in commercial construction and your everyday business is completing commercial fitouts you need to know how the finance market has changed. A number of lenders have really contracted and restricted their availability of funds they have for fitouts.
Why are some businesses finding it hard to get approved for fitout finance?
Commercial lenders are constantly assessing the market to understand which industries are performing the strongest and which industries might be in decline.
Those business loan customers in stronger industries are preferred clients as they’re seen as being a lower risk and more likely to successfully pay back their fitout finance.
Industries seen to be impacted by the government policies of extended lockdowns could be less desired by the banks. Hospitality, fitness, health and beauty and retail spaces are all industries that could find it harder to get approved.
What to do if your client has been declined
There are a number of lenders who look to fill the gaps left by the major banks lending policies. A successful strategy will involve a expert and a lender who can look at the fundamentals of the business seeking finance and beyond their industry type.
Often times there is a business case demonstrating the commercial fitout leads to greater opportunity and many lenders will look to the performance of the business outside of lockdowns to help make a decision about whether they should be providing finance or not.
It’s one of the reasons commercial construction businesses refer their clients to us.
Final Tips
There are a number of second tier lenders working well in this space and helping businesses fund their fitouts. We recommend lenders who are open to soft costs, and paying builders direct.
This way you’ll be able to get the job done even with the current restrictions taking effect.
Related Links
Case Study: Move the cost of moving premises over 4 years with fitout finance