Commercial Finance
Commercial Property Loan Requirements Australia
6 min read- Eligibility Guide
- Updated 2026
Quick answer
Most approvals depend on LVR and servicing
60% 75%
Common commercial LVR range
- Deposit or equity Often 25% to 40%
- Income evidence Usually required
- Lease income Important for investors
- Lender policy Varies widely
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Commercial property loans are usually assessed using two main requirements
Suitable security and LVR
The lender looks at the commercial property being offered as security, the asset type, location, valuation, tenancy profile and the requested loan to value ratio. Standard commercial loans often sit around 60% to 75% LVR, with lower limits for specialised or higher-risk assets.
PROPERTY-BASED TEST
Clear ability to service the loan
Lenders check whether the loan can be repaid from business income, rental income, external income, cash flow or a combination of these. They may review tax returns, financial statements, BAS, bank statements, leases, rent schedules and existing debts.
Income-based testTypical commercial loan requirement ranges
Exact criteria depend on lender policy, property type, borrower strength and whether the loan is bank, non-bank or private funding.
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Standard commercial property 60% to 75% LVR
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Specialised or higher-risk property 50% to 65% LVR
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Stronger owner occupied or low-risk deal Case by case higher LVR
For example, a well-located office, warehouse or retail property with strong borrower income may be assessed differently from a vacant hotel, service station, childcare centre or hospitality asset. For deposit detail, see our commercial property loan deposit guide.
Need help checking your eligibility?
Borrower and income requirements
To work out how to qualify for a commercial property loan, lenders usually review the borrower behind the deal. They may ask for:
Business financial statements and tax returns- Profit and loss, balance sheet and cash flow position
- BAS, bank statements or accountant-prepared figures
- Existing loan commitments and repayment conduct
- Directors, guarantors, company or trust structure
Low doc and alternative income options may be available, but they usually depend on lower LVRs, stronger security or specialist lender policy.
Lease and property requirements
For investment commercial property, lenders usually look closely at rental income. For owner occupied property, they may focus more on the operating business. Key property criteria include:
Property type- Location
- Tenant quality, lease term and rent coverage
If lease income is central to the deal, review our guide on commercial investment property loans.
Common commercial mortgage criteria
Commercial lenders do not all use the same rules. Banks tend to want cleaner income evidence, stronger servicing and lower-risk security. Non-bank lenders may consider more complex deals, but pricing and fees can be higher.
Typical assessment areas include:
Deposit / Equity
25% to 40%
Often needed depending on the property, lender and borrower profile.
Servicing
Must stack up
Income, rent, cash flow and existing debts need to support repayments.
Borrower Structure
Clear setup
Individuals, companies, trusts and SMSFs can be considered under different policies.
Company and trust borrowing can work well when structured properly. See company commercial property loans and trust commercial property loans for structure-specific guidance.
Common reasons commercial property loans get declined
Many borrowers are declined because the deal is sent to the wrong lender, the documents are weak, or the property does not match the lender's appetite.
Not Enough Deposit Or Equity
Commercial loans often need more borrower contribution than residential loans. If the requested LVR is too high, the loan may be reduced or declined.
Possible solutions include:
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Using extra equity from another property
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Reducing the loan amount requested
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Comparing lenders with different LVR rules
Weak Servicing Or Cash Flow
If the business income, rent or borrower income does not comfortably support the repayments, mainstream lenders may decline the application.
Improving financials, reducing other debts, adding income evidence or choosing a lender with different servicing policy may help.
Property Type Outside Policy
Some lenders avoid specialised assets, vacant commercial property, short leases, regional locations or properties with limited alternative use.
A non-bank or specialist commercial lender may be more suitable where the asset is acceptable but not standard bank policy.
Poor Document Preparation
Missing financials, unclear ownership structures, unexplained credit issues or incomplete lease documents can slow or damage an application.
Prepare clean documents before applying, especially if the property is being purchased through a company, trust or SMSF.
Steps to improve commercial property loan approval chances
Step
01
Confirm the property type, location, valuation position and whether it is owner occupied, leased or vacant.
Step
02
Work out the likely LVR and whether your deposit or equity position is strong enough.
Step
03
Prepare financials, tax returns, BAS, bank statements, lease documents and details of existing debts.
Step
04
Check whether your borrower structure needs company, trust, SMSF or guarantor review before applying.
Step
05
Match the application to lenders that actually accept your property type, income profile and LVR.
Step
06
Submit a clean application with the right lender instead of shopping the deal randomly across the market.
Speak with a Commercial Finance Specialist
Commercial property loan approval can vary significantly depending on property type, LVR, lease income, borrower structure, financials and the lender selected.
A specialist can review your scenario and help determine which commercial lenders may be suitable before you apply.
Speak with a finance specialist about your commercial property loan requirements.
Submit the short form below and a commercial finance specialist will review your deposit, property type, income position and possible lender options.
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Additional Questions
You may also find these commercial property loan guides helpful
