What Are the Different Types of Short-Term Loans and Their Benefits?

Here at Hodgestone Finance, we can help our clients secure competitive short term loans using our network of private and non-bank lenders. Short term loans can be used for a variety of purposes, and there are several types of short term loans in Australia available that reflect this.

If you’re unsure of what type of short term loan you should investigate, this blog will help! We’ll explain the different kinds available, and answer a few common questions to help you decide.

What is a Short Term Loan?

Short term loans are characterised by their short repayment time. Unlike more traditional loans, which you may have decades to pay off, short term loans tend to only extend up to a year. They are often used by businesses for a variety of reasons, including:

• To make a quick purchase of desirable property that has just become available.
• To hire more staff in a sudden busy period.
• To buy equipment to help the business expand.

Individuals can also use them:

• To bridge longer periods between paychecks.
• As liquid funds for a couple of months when you’re lacking financials.

Short term loans can be lifesaving for clients in need of immediate financing. They can provide you with the funds you need, which then need to be paid back in a shorter period of time than a standard loan

Hodgestone Finance is very active in the short term lending space and can facilitate settlements within a week, with no valuation needed. These loans are typically secured by a caveat on title, and we always make sure you have a clear exit strategy in place. This is so we can help you exit as soon as possible, as the interest rate on these loans can be as high as 3% per month.

Types Of Short Term Loans in Australia

We can help you secure a variety of different short term loans in Australia, including:

Bad Credit Short Term Loans

Do you have a bad credit score? It can impact your ability to get a loan from one of the big banks, but Hodgestone Finance can still assist you. Our short term loans are available for people with bad credit scores, and can allow you to get the money you need, pay it back on time, and strengthen your score to put you in a better position for the future.

Like with other ‘riskier’ loans, you will need to have a suitable exit strategy in place–this could be property or assets you plan to sell, some income you know you have coming in, or refinancing your property.

Low Doc and Non-Conforming Short Term Finance Options

Are you self-employed, an investor, or a new small business owner? Chances are, you won’t have a lot of the documentation needed to get a loan from a traditional bank. Hodgestone Finance can assist self-employed and non-conforming clients with low doc or no doc short term loans, as long as you can provide documents like:

• A BAS statement, or;
• A letter from your accountant or a signed declaration of income

These short term finance options can sometimes be confusing to choose between, but our brokers can help you decide on which type is best for your situation please get in touch if you have questions.

Short Term Bank Loans

Need to get a short term loan from your bank? Hodgestone Finance can assist you with more than just private lending–we’re also experienced in facilitating short term loans from big banks, including the Big 4 and banks like Suncorp and Macquarie.

Short Term Bridging Loans

Want to buy a new property without the pressure of selling your old one? Don’t miss out on purchasing your dream home due to unlucky timing–a short term bridging loan can help.

We can help facilitate open (still selling with an undecided settlement date) and closed (sale date on old property has been set) bridging loans, with rates depending on the lender, the value of both of the properties in question, and your borrowing profile.

2nd Tier Short Term Lender Finance

2nd tier refers to non-bank financiers that are smaller than banks (tier 1), but larger than private (tier 2) lenders. Like with the big banks, we can also help connect you with the right non-bank, 2nd tier lenders for short term finance.

Hodgestone Finance have helped many clients secure competitive short term loans across Geelong, Bendigo, Shepparton, and Gippsland.

Short Term Loan Examples

Here are some examples of when we’ve seen our clients make great use of a short term loan!

• Farmers and those working in the agricultural sector have used short term loans to hire equipment and extra staff during busy seasons. By ramping up production when produce is abundant with the help of a short term loan, farmers can make the most of these seasonal booms!
• Property owners under quick settlements during sales can use a short term loan to buy time and preserve their house deposit, taking the stress out of having to buy and sell quickly.

Case Study

Hodgestone Finance assisted a client in northern NSW to seize a business opportunity with the help of a short term loan.

The client had acquired a development site through an option that needed to be exercised within one week; otherwise, they would lose the site and all the option payment they had made up to that point.

Hodgestone Finance successfully facilitated a short term funding solution secured against the purchase of property, plus a caveat registered over an existing asset, thereby enabling the settlement to take place within a week.

The short term loan facilitated by Hodgestone Finance allowed the client to settle on the purchase property in time, so that they could continue their expansion and develop the site. Had it not been for the short term loan, the client would not have been able to seize the business opportunity, and they would have lost the money they had already contributed.

Whether you need help securing short term loans in Melbourne, Sydney, or Brisbane, Hodgestone Finance are the brokers to trust with the job!

Short Term Loan FAQs

1. Does a short term loan use a fixed or variable rate?

Due to the shorter repayment time frame of short term loans in Australia, they will usually have fixed rates over variable ones.

2. What short term loan amount can I get from Hodgestone Finance?

We can help you secure a short term loan for any value between $150,000 and $50,000,000.

3. What kinds of lenders do you have access to?

Hodgestone Finance’s lending network includes major banks (including the Commonwealth Bank, ANZ, NAB and Westpac), 2nd tier lenders, private mortgage trusts, short term lenders, and specialist development funders.

Secure a Short Term Loan Now Through Hodgestone Finance

If you think a short term loan could be just what you or your business needs, then we encourage you to reach out to us to get started. At Hodgestone Finance, we are very active in the short term lending space and can source and structure good short term options for our clients across the country.

To get started, use our quick enquiry form online, email us at info@hodgestonefinance.com.au, or call 1300 463 439 to speak with us directly. No matter if you need assistance with short term finance in Sydney, Melbourne, or anywhere else across Australia, we can connect you with the perfect lender from our network.