Commercial bridging finance lenders should be compared against a defined transaction, not placed in a generic “best lender” ranking. A lender that suits a contracted metropolitan property sale may not accept an open refinance exit, specialised commercial security or a complex ownership structure.
This guide sets out six practical tests for comparing lenders: mandate fit, property and security, exit evidence, net proceeds, fees and conditions, and default risk. It does not rank or name lenders, and the method is not tied to the year shown in the page address. The information is general and is not legal, tax or financial advice.
Emet Capital is a commercial finance broker, not a bank or direct lender. Business borrowers can use the commercial bridging finance service to discuss a scenario. An enquiry starts a discussion; it is not an approval or a commitment to lend.
Types of commercial bridging lenders
| Lender category | Typical decision approach | Confirm before relying on an indication |
|---|---|---|
| Bank or established non-bank | Policy-led assessment with fuller serviceability and documentation | Whether the required term and settlement date fit policy |
| Specialist property lender | Defined property, location, leverage and exit rules | Valuation method, accepted security and open/closed exit appetite |
| Private credit fund | Credit-committee assessment within an investment mandate | Mandate, funding certainty, due diligence and decision timetable |
| Smaller private lender or syndicate | Case-by-case judgement and negotiated structure | Source of funds, lender of record and any third-party approval |
| Development or transitional lender | May assess construction, lease-up or repositioning risk | Milestones, quantity surveyor or project conditions and exit requirements |
Categories overlap. Ask who will provide the funds, who issues formal approval and which facts could cause the lender or its capital source to change.
Six tests for comparing lenders
Give every lender the same transaction facts. A comparison only works when each lender has seen the same property, existing debt, borrower structure and exit plan, and has answered the same questions in writing.
1. Mandate fit
A lender's mandate is the set of loans it is able and willing to make: purpose, borrower type, location, loan size, term, security position and exit. Ask early whether the scenario falls inside the current mandate and which facts could move it outside. A prompt decline is more useful than an indicative offer that depends on an exception the credit team has not yet seen.
For private funds and syndicates, also ask where the money comes from, whether it is committed to this loan and who makes the final credit decision.
2. Property type and security
Map the security before approaching lenders: property type, location, ownership, value evidence, leases, vacancy, existing debt and title interests. Commercial property may require review of leases, environmental or planning matters. A lender's headline leverage or speed statement is not meaningful until the actual property and security position are accepted.
Confirm whether the lender would take a first or second mortgage, whether an existing lender must consent, and how value will be assessed. The commercial property valuation guide explains what lenders usually want from a valuation.
3. Exit evidence
A bridge is temporary, so the repayment source matters as much as the security. Is repayment expected from a contracted sale, an uncontracted sale, a refinance or another liquidity event? The certainty, evidence and expected timing of that exit shape lender appetite.
Ask each lender what exit evidence it needs before approval and before settlement, and what happens if the exit is late. The bridging loan exit strategy guide and the open versus closed bridging comparison explain how exit certainty changes the structure.
4. Net proceeds
Start from the obligation the bridge must meet, such as a purchase balance, a maturing debt or a settlement shortfall. Then ask each lender which amounts would be deducted or retained at settlement, including fees, any interest paid in advance and repayment of existing debt, and what cash would remain. Compare that remaining amount, not the gross facility.
The Australian Government's business loan guide notes that loans vary a lot in their costs and conditions, including the amount you can borrow, the loan term, the interest rate, whether the rate is fixed or variable, and set-up costs and ongoing fees. Two offers with the same headline amount can leave very different cash available.
5. Fees and conditions
Record the same items for every written offer:
- borrower, guarantor and security entities;
- current obligation and required settlement date;
- property and valuation assumption;
- existing debt and proposed security priority;
- gross facility and cash available after deductions;
- interest rate, calculation, payment and capitalisation;
- establishment, valuation, legal, line, management and discharge costs;
- minimum-interest or early-exit provisions;
- term, extension mechanics and delayed-exit cost;
- approval and settlement conditions;
- reporting, control and guarantee requirements;
- accepted exit and evidence required.
Model the total repayment at the expected exit and at a delayed date. A facility with lower initial pricing may be less suitable if it has a rigid maturity, expensive extension or conditions the transaction cannot meet.
An indicative quote normally relies on unverified facts. It can change after valuation, title review, credit assessment, legal due diligence or new information, so ask the lender or broker to list every assumption. Conditional approval is also not the same as funds available at settlement. Conditions may include a satisfactory valuation, legal review, first-mortgagee consent, evidence of the exit, executed security documents, insurance or repayment of another debt. The commercial property settlement timeline shows how these steps fit around a settlement date.
Avoid committing to a purchase or telling another creditor that funds are certain based only on an informal indication. Obtain legal advice on transaction deadlines and finance conditions.
6. Default risk and downside
The Australian Government's business loan guide explains that a secured loan is backed by collateral, such as property, and that if you don't repay the loan, the lender can take the security to cover its losses. Read the default terms as closely as the pricing:
- which events count as a default, apart from a missed payment;
- default interest, default fees and enforcement costs;
- what happens at maturity if the exit is delayed;
- which people or companies give guarantees;
- any power to appoint a receiver over the security.
ASIC notes that disputes can arise if a lender appoints a receiver to deal with an asset that a borrower has used as security for a loan. Ask each lender to explain, in writing, the steps it would take if the loan were not repaid at maturity.
Borrower protections and disputes
ASIC explains that the law provides the lowest level of protection to commercial loans, including loans to small businesses. Its commercial loan disputes guidance notes that the ASIC Act still prohibits unconscionable conduct, misleading or deceptive conduct, and unfair contract terms in standard form small business contracts.
ASIC's unfair contract terms guidance for small businesses sets tests for both the business, based on employee numbers or turnover, and the contract, including a $5,000,000 cap on the upfront price payable for financial products or services. The law does not cover individually negotiated contracts. Terms that set the upfront price, such as the amount borrowed, the interest rate and disclosed establishment fees, cannot themselves be considered unfair, while late fees and other contingent fees are subject to the law. Ask a lawyer how these tests apply to a particular facility.
External dispute resolution also differs between lenders. ASIC explains that the Australian Financial Complaints Authority (AFCA) can resolve complaints from small businesses about commercial lending, but only about financial firms that are AFCA members and within AFCA's limits on claims and compensation. Lenders that only provide commercial loans are not required to hold a credit licence and are not legally required to be AFCA members, although some join voluntarily. Ask each lender whether it is an AFCA member and record the answer in the comparison. ASIC encourages borrowers to get independent legal advice if access to AFCA is not available.
Check who you are dealing with
The Australian Government's business loan guide suggests researching any finance company you haven't heard of: search the name or ABN on the ASIC register, then check the list of companies you shouldn't deal with. It also warns that scammers sometimes target businesses by claiming they are eligible for, or have already been approved for, a loan they haven't applied for. Real lenders don't do this.
Pause if the proposed lender is not clearly identified, bank details or legal representatives cannot be verified through trusted channels, fees are unexplained, terms are only verbal, independent legal advice is discouraged, or the facility relies on an exit the lender has not examined.
Also investigate a quote that assumes a higher value, lower existing debt or shorter term than other offers. Apparent price differences often reflect different inputs. Ask for a corrected, like-for-like comparison.
What a bridging finance broker should add
A broker should test product fit, organise a consistent evidence pack, approach lenders whose mandates align and compare written terms. The broker should explain why lenders were included or excluded and distinguish known amounts from estimates.
Emet Capital has access to over 50 lenders. Availability and lender appetite vary by transaction, so a large panel only helps when the scenario goes to lenders that can accept the property, the borrower and the exit.
The Australian Government's business loan guide notes that some brokers charge for their services, while others are free and get a commission from the lender. Ask how the broker is paid, how many lenders received the file, whether each saw the same facts and what could still change. The bridging loan broker selection guide lists further questions to ask.
No broker can promise that a lender will accept a valuation, approve a file or settle by a particular date. The most useful service is clarity about dependencies and trade-offs.
Lender selection sequence
- Define the obligation, required net proceeds and settlement date.
- Document property, title, existing debt and entity structure.
- Evidence the primary exit and a delayed-exit contingency.
- Shortlist lenders whose mandates fit those facts.
- Verify each lender's identity and ask whether it is an AFCA member.
- Obtain written indicative terms with assumptions and conditions.
- Compare net proceeds, expected and delayed total cost, and default terms.
- Select on executable fit, downside and total terms, not rate or speed alone.
- Get independent legal advice, and any accounting or other advice you need, before signing.
Related Guides
- Commercial Bridging Finance Guide
- Open vs Closed Bridging Loans
- Bridging Loan Exit Strategies
- Commercial Property Settlement Timeline
- Commercial Bridging Finance
This article is for informational purposes only and does not constitute financial advice. Emet Capital provides commercial lending solutions to eligible business borrowers. Please consult a licensed financial adviser, accountant, or commercial finance specialist as appropriate before making any financial decisions.