The lending barrier
The owners had a commercial property with a national pharmacy tenant and a ten-year lease. Rental income was their main source of income, yet the initial lending pathway called for extensive personal income evidence and a short repayment schedule. The challenge was to find an assessment and structure that reflected how the property actually generated cash flow.
How we approached it
We built the proposal around the lease: the executed terms, net rental income, tenant position and remaining lease period. We compared commercial lease-doc lenders, tested their rental coverage requirements and reviewed the valuation and company position. The structure comparison looked at interest-only payments, amortisation and the facility’s maturity date together. That made the immediate cash-flow benefit and the eventual repayment or refinance requirement clear.
The outcome
The proposed solution aligned the commercial facility more closely with the property’s rental income. A suitable lease-doc assessment and repayment structure would reduce the mismatch between a long-term tenant lease and the owners’ immediate loan commitments.
What this means for borrowers
Commercial lending starts with understanding the source of repayment. For this property, the lease was the strongest part of the application. Matching that evidence to the right assessment pathway was more useful than repeatedly presenting the same proposal under a personal-income model.
Questions about this case
Is a 30-year amortisation the same as a 30-year facility?
No. Amortisation describes the repayment calculation; the facility may mature much sooner. The borrower needs to understand both the repayment schedule and any refinance or payout required at maturity.
This is an illustrative scenario comparable to deals we have handled for our clients. Figures and outcomes are examples; lending remains subject to individual assessment.