We help property owners bypass drawn-out loan applications and cash in on accrued equity with fast caveat loans.
Caveat loans offer rapid access to capital by utilising the equity in real estate properties. They differ from traditional mortgages as they secure the loan by lodging a caveat against the property title, rather than transferring ownership. They are the ideal solution for urgent financial needs for borrowers who may not qualify for conventional bank loans.
Caveat loans deliver finance with rapid speed because they are largely focussed on the equity position of the property being used as security. That means no in-depth income assessments and other roadblocks associated with traditional mortgage applications.
Unlike with traditional financial products, caveat lenders are generally less rigid with what they require from applicants. Minor defaults in your credit history and unconventional financial situations aren’t necessarily the non-starters they might be for bank loan applications.
Caveat loan funds aren’t earmarked for any particular purpose. Once they’ve been released, it’s up to you to spend the money however you like. Need cashflow to tide your business over during a quiet period? Want to seize a time-sensitive investment opportunity? A caveat loan might be the answer.
You can rest assured that Northcap’s large private lending network offers the most favourable terms available for caveat finance. Multiple options make for better outcomes for you – the borrower.
You’ll always get finance faster with us. Nowhere is this truer than with caveat loans. Provided your securing property has sufficient equity, we can turn things around at lightning speed.
We don’t do upfront or monthly fees. At Northcap, we’re firm believers that finance brokers should get paid only when their client does. Work with us with the confidence that won’t be billed for ongoing charges.
The cyclical nature of business dictates there’ll be ups and downs. During downturns, or faced with emergency expenses, caveat loans can be deployed for a quick fix that keeps things ticking over until better times. Depending on your terms, you might even be able to capitalise the interest portion of the loan.
Time and opportunity wait for no one. Caveat loans are a speedy and simple mechanism for jumping on an investment opportunity. Looking to take an equity share in a start-up, act on a hot stock tip, or snap up a bargain on a capital investment for your business? Could be time to look at caveat loans.
If you’re bogged down with high-interest repayments like credit card bills, a caveat loan might facilitate consolidation of multiple debts into one financial instrument. The potential for more favourable interest terms aids serviceability, freeing up cashflow for more productive purposes.
We’re ready when you are. Connect with one of our brokers today to get a clear view to unlocking equity in your property.
The key difference between caveat loans and mortgages is that they’re less enforceable. If a borrower (known as the caveatee) defaults on their agreed caveat loan repayments, the lender (or caveator) can’t compel the liquidation of the property to recover funds like a bank can with a standard home loan. Caveat loans are deemed a higher risk loan subset by lenders, and therefore attract higher interest rates.
A caveat is essentially an administrative notice attached to a piece of real estate used by a borrower to secure a loan. While active, the caveat informs the public that the caveator (the lender in the case of caveat loans) has a legal claim to the asset. Properties with active caveats can’t be sold or used as security for additional loans.
In the case of a caveat loan, the caveat is only removed once the loan is repaid in full as per the finance contract.
There are several factors relating to the property used to secure the caveat loan that affect the total amount you can borrow. These include:
Depending on the first three of these factors, you might be able to secure a LVR (loan-to-value ratio) of up to 80%. The LVR in this case is the proportion of the available equity in the property used as collateral.
So, for example, if you own a property valued at $1,000,000, and you owe $200,000 on the mortgage, you might be able to borrow 80% of the equity amount of $800,000 via a caveat loan, which is $640,000.
The terms are interrelated, but not interchangeable. Caveats and liens are both types of encumbrances, legal notices placed on real estate properties indicating a party other than the owner has a claim to the asset. Where caveats are used by lenders in the case of caveat loans, liens (or worker’s liens) can be lodged by tradespeople who have done work on a property at the owner’s request but haven’t been paid in full.
If you own a property with an active caveat or lien, you won’t be able to sell it or use it as collateral for additional finance.
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