Direct answer
A short-term business loan is a business-purpose facility, typically running from a few weeks out to around two years, used to bridge a cash-flow gap, fund an acquisition, or buy time ahead of a refinance. In Australia it can be arranged secured (property, caveat or general security agreement) or unsecured, through banks, private lenders and specialist funds, with funding often available inside one to ten business days.
Who uses it and why
Short-term business loans are reached for when timing matters more than getting the cheapest possible rate. A director with a Business Activity Statement debt and a bank deadline needs certainty before month end, not a facility that may or may not be approved in six weeks. A trading company with a signed contract and a supplier that wants payment up front needs working capital now, against the strength of that contract, not last year's financials. A property owner mid-negotiation on a second site needs to move on it before the vendor takes another offer, and a term loan application through a mainstream bank simply will not turn around in time.
The common thread is a gap between when cash is needed and when it is available through the borrower's usual channels. That gap might be created by a settlement date, a tax office deadline, a seasonal trading cycle, an opportunity with a short fuse, or a temporary setback such as a lost debtor or a delayed insurance payout. In each case the facility is a bridge: it is priced and structured on the basis that it will be repaid or refinanced within months rather than years, and the exit is usually as important to the lender as the security itself.
Borrowers typically include company directors, self-employed operators, property developers between stages, importers waiting on stock, and businesses managing a temporary ATO debt. Entities are usually companies or trusts, and the loan is written for business or investment purpose only — not for personal or household spending, which sits outside what Solara arranges.
What lenders look at
Every panel lender assesses the same underlying question — how does the facility get repaid — but banks, private lenders and specialist funds weigh the inputs differently.
Security is the starting point. This product can be written against a first or second mortgage over residential or commercial property, a caveat, a general security agreement (GSA) over the business, or on an unsecured basis for stronger-covenant borrowers. Where property security is offered, lenders will look at the asset type, location and existing encumbrances, and will typically lend to a loan-to-value ratio in the order of 65–75%, though this varies by asset class and lender appetite.
The exit is scrutinised as closely as the security. Because these are short-dated facilities, the lender wants a credible, evidenced path to repayment: a signed contract of sale, a refinance already in train with a bank, a debtor payment schedule, or a trading cycle that clearly produces the cash. A facility with a vague exit — "we'll sort it out" — is harder to place regardless of the security on offer.
Serviceability and cash-flow evidence come next, and this is where the three lender types diverge most. Banks generally want full-doc financials, tax returns and BAS lodgements that demonstrate serviceability on their own terms, and they move more slowly because of it. Private lenders will often work from alternative or low-doc evidence — BAS, bank statements, an accountant's letter — and price and structure around the security and exit rather than insisting on a clean full-doc picture. Specialist funds sit between the two, often taking a portfolio or sector view and willing to move on thinner documentation where the security and exit are strong.
Entity structure and documentation matter throughout: is the borrower a company, trust or sole trader, is the entity trading or newly established, and are directors offering personal guarantees. Credit history is read for context rather than as an automatic filter — panel lenders in this category will consider applicants with defaults or judgments on file, provided the story behind them and the current security and exit stack up. This is genuinely a wider-tolerance product than a standard bank term loan, though outcomes still depend on the full picture and no lender writes every file.
Typical terms
|
|
| Size |
$50,000 to $5m+, subject to lender assessment |
| LVR |
Typically up to 65–75% where secured by property |
| Term |
From under three months out to two years, occasionally longer |
| Speed |
Indicative funding in 1–10 business days from a complete application |
| Security |
Residential or commercial first/second mortgage, caveat, GSA, or unsecured |
| Pricing |
Priced on risk and security; indicative range on enquiry |
Structures we see most
Capitalised-interest bridge. Interest is added to the loan balance rather than serviced monthly, freeing up the borrower's cash flow during the bridge period. Common where the exit is a settlement or refinance and the borrower would rather not carry a monthly repayment against income that is already stretched. The trade-off is a larger balance to repay or refinance at the end of the term, so the exit needs to comfortably absorb it.
Caveat behind a bank first mortgage. Where the property already carries a bank facility, a caveat loan sits behind it, secured by a caveat over the title rather than a registered second mortgage in every case, though a registered second is also used depending on the lender and the amount. This suits a borrower who needs a smaller, faster top-up without disturbing an existing bank relationship or triggering a full refinance.
GSA-only facility. For a trading business with limited or no property to offer, a general security agreement over the company's assets and undertaking can support a working-capital or acquisition facility on its own, particularly where turnover, debtor quality or a signed contract provide the lender with confidence in the exit.
Second mortgage term bridge. A registered second mortgage behind an existing first, used where the borrower wants a longer runway than a pure caveat structure — commonly six to eighteen months — to complete a project stage, settle a tax debt, or trade through to a stronger financial position.
Unsecured short-term facility. For borrowers with strong trading covenant and no property to offer, or who prefer not to encumber property for a smaller amount, an unsecured facility is available, typically at lower amounts and shorter terms, priced to reflect the absence of hard security.
Costs and how we're paid
Pricing on short-term business loans reflects the risk, the security offered and the speed required, and is quoted on enquiry once the lender panel has assessed the file — there is no single rate that applies across the product, and any figure quoted before assessment should be treated as indicative only. Facilities may carry an establishment fee, ongoing line or account fees, and, where applicable, exit or discharge costs; all of these are set out in the loan offer before a borrower commits.
Solara is remunerated by the lender, the borrower, or both, depending on how a facility is structured — this may include a commission from the lender and/or a broker fee agreed with the borrower. Any commission or fee is disclosed in writing before an application proceeds, consistent with our obligations as an intermediary arranging business-purpose finance.
Process and timing
- Initial scoping call — typically same day. We take the borrower through the requirement, the timeframe, the security available and the intended exit, and give an early read on whether it is a fit for this product.
- Document collection — typically 1–2 business days. Identification, entity documents, security information and whatever evidence of exit and serviceability the likely lender panel will need — this varies by whether the facility is full-doc, alt-doc or low-doc.
- Lender matching and submission — typically 1–2 business days. We place the file with the banks, private lenders and specialist funds best suited to the security, exit and timeframe, rather than a single lender, to get genuine terms on the table.
- Approval and offer — typically 1–5 business days, faster for private lenders and specialist funds, longer where a bank is the best fit for the borrower's circumstances.
- Documentation and settlement — typically 1–3 business days once terms are accepted, security is registered or noted, and conditions precedent are satisfied.
Frequently asked
What is a short-term business loan?
It is a business-purpose loan, generally running from a few weeks to around two years, used to bridge a timing gap — a settlement, a tax debt, a trading cycle or an opportunity — rather than to fund long-term asset ownership. It can be secured or unsecured and is arranged through banks, private lenders and specialist funds depending on the borrower's circumstances.
How fast can a short-term business loan be funded?
Indicative funding timeframes run from around one to ten business days once a complete application, security information and evidence of the exit are with the lender. The fastest outcomes are typically with private lenders and specialist funds on caveat or GSA structures; bank-funded facilities generally take longer.
Do I need property to get a short-term business loan?
No. Property security supports the largest facilities and the lowest pricing, but caveat, GSA and unsecured structures are all available for businesses without property to offer, priced and sized according to the covenant and exit on offer.
Can I get a short-term business loan with a default or judgment on my credit file?
Often, yes. This product has a genuinely wide credit tolerance across the panel, and lenders will consider applicants with defaults or judgments provided the circumstances, security and exit are explained and stack up. It is assessed case by case rather than filtered automatically.
What can a short-term business loan be used for?
Common purposes include working capital, bridging finance ahead of a settlement or refinance, business acquisition, and managing a tax office debt. It must be for a business or investment purpose — consumer or household use falls outside what Solara arranges.
Is a short-term business loan the same as a bridging loan?
They overlap. Bridging finance is a specific use case — moving from one position to another, such as ahead of a property sale — within the broader short-term business loan category, which also covers working capital, acquisition and tax debt scenarios that are not strictly a "bridge" in the property sense.
What size loan can I get?
Facilities in this category typically run from $50,000 up to $5m and beyond, subject to the lender's assessment of the security, exit and covenant on offer. There is no fixed ceiling; larger facilities are placed with lenders whose appetite matches the amount.
How is a short-term business loan priced?
Pricing is set on risk and security once a lender has reviewed the file, reflecting the term, the security type, the exit and the borrower's documentation level. An indicative range is provided on enquiry rather than published as a flat rate, because the same facility can price very differently depending on what backs it.
Related products
Bridging loans — the better fit when the requirement is specifically about moving from one property position to another, such as buying before selling, rather than a broader working-capital or tax-debt need.
Caveat loans — worth considering on its own terms when speed is the dominant factor and the borrower wants the fastest possible structure sitting behind an existing mortgage, rather than the wider range of structures covered here.
Unsecured business loans — the better starting point when the borrower has no property to offer at all and the requirement is smaller, since it is built specifically around covenant-only lending rather than a mix of secured and unsecured structures.