What equity do I need for 2nd mortgage finance?

Short term business loans such as caveat loans and second mortgage loans are higher risk for a lender. As such, this is a result of minimal income and other credit requirements. Consequently, to reduce lender risk, lenders require more equity.

Private lenders usually require 25% equity; or a maximum 75% LVR inclusive of closing costs, fees and capitalised interest. In some cases, you may obtain capitalised loans payments. For the same reason, risk reduction would require a strong exit strategy along with your ability to meet payments.