Quick answer
Private lenders often accept property that banks restrict, such as vacant land, rural acreage, specialised commercial buildings, properties in small regional towns, small units and company or trust-owned property. They assess how saleable the property is, the equity available and the exit plan. Loans may be smaller relative to the property's worth than with standard security, but they can unlock funds a bank won't.
Key points
- Private lenders assess unusual property case by case
- Saleability and equity drive the decision
- Expect more conservative loan amounts on unusual property
- A clear exit matters even more with non-standard security
- Examples
- Vacant land, rural, specialised, regional
- Range
- $20k to $5m, subject to equity
- Key factor
- How easily it could be sold
When the property is the problem
Sometimes there’s nothing wrong with you or your business. The bank simply won’t accept the property you’re offering as security. It might be land with no house on it, a rural block, a building designed for one purpose, or a unit below the bank’s minimum size.
Banks keep tight rules about security because they lend in large volumes and want everything to fit a standard. Private lenders lend in smaller numbers and can look at each property on its merits. Our page on why security gets refused explains the bank side; this page covers the alternatives.
Property types private lenders often consider
| Property type | What lenders think about |
|---|---|
| Vacant residential land | Zoning, access, services, local demand |
| Rural and lifestyle acreage | Size, distance from towns, improvements, water |
| Specialised commercial | Service stations, childcare, motels: how many buyers there are |
| Industrial units and warehouses | Location, condition, tenancy |
| Regional town property | Depth of local market, recent sales |
| Small or high-density units | Size, building quality, investor demand |
| Mixed-use property | Shop plus residence: zoning and use |
| Company or trust-owned property | Authority to give security, who signs |
What changes with unusual security
Loan amounts are often more conservative. Because unusual property can take longer to sell, lenders typically leave more equity as a buffer.
The exit matters even more. If the lender is less certain about selling quickly, it wants a clear plan for repayment through other means, such as a refinance, a sale already under way or a known payment.
Information helps. Recent comparable sales, rental details, zoning certificates and photos can all speed things up.
Property-secured business loans range from $20,000 to $5,000,000, depending on the property and the equity available. A private first mortgage or caveat loan are the most common structures.
Using more than one property
If one property can’t support the full amount, a lender may consider taking security over two. For example, a vacant block plus a modest equity position behind your home loan. Everyone on each title needs to agree and understand the risk.
What to prepare
- Full address, title details and current use of the property.
- Who owns it, including any company or trust.
- Existing loans, balances and lenders.
- Zoning information and any approvals or restrictions.
- Recent sales of similar properties nearby, if you know them.
- Rental income, if it’s tenanted.
- Your purpose and exit plan.
Have a property your bank won’t touch? Tell us about it.
Illustrative example: A small manufacturing business owned a vacant industrial lot in a regional centre, held in the family trust. The bank wouldn’t lend against vacant land in that town. A private lender accepted the lot, with the trust as security provider, for a conservative loan used to buy machinery, with a plan to refinance once a planned shed was built on the lot.
How lenders think about saleability
Every lender taking property security asks a quiet question: if this ever had to be sold, who would buy it, and how long would it take? Unusual properties aren’t necessarily worth less, but they often have fewer buyers, and fewer buyers means more uncertainty.
That uncertainty shows up in a few ways:
- A more conservative loan amount, leaving a larger equity buffer.
- A shorter loan term, so the lender isn’t exposed for long.
- More questions about the exit, because the lender doesn’t want to rely on a sale.
- Requests for extra information, such as zoning certificates, lease details or photos.
You can reduce that uncertainty by doing some of the lender’s homework for them. Gather recent sales of similar properties, any rental or lease documents, and anything that shows the property is well located, approved and in good condition.
What to know about common unusual security types
| Property | One thing to check before applying |
|---|---|
| Vacant land | Zoning and whether services such as water, power and sewer are connected |
| Rural acreage | Whether it’s primarily residential lifestyle or a working farm |
| Specialised commercial | Whether there’s a current lease or business operating from it |
| Small inner-city unit | Internal floor area and building condition |
| Regional town property | Recent comparable sales in that town |
| Company or trust-owned | Whether the entity’s documents allow it to give security |
| Mixed-use shop and residence | Current approved use and any heritage overlays |
None of these is automatically a deal-breaker for a private lender. They’re simply the questions that come up first, and having answers ready speeds everything up.
Quick checklist for unusual security
- Order a title search to confirm owners and existing interests.
- Gather zoning information and any approvals.
- Note recent sales of similar properties nearby.
- Collect lease or rental details if the property is tenanted.
- Take clear, recent photos of the property.
- Write a specific exit plan with a backup.
- Confirm everyone on title agrees to provide security.
A different lender may see value the bank didn’t
If you own property that a bank won’t accept, it may still be worth something to a private lender. Sending us an enquiry doesn’t involve a credit check, and we don’t scatter your details across a group of lenders. A real person reads your situation and calls you. Please describe the property type, location and ownership accurately on the form, so we can match it with a lender that takes that kind of security. See what’s possible.
Frequently asked questions
Can I borrow against vacant land?
Often, yes, with private lenders. Expect a more conservative loan amount than for a house, and be ready to explain zoning, access and services.
Will a lender accept a rural property?
Many private lenders will, depending on size, location and use. Properties primarily used for farming may need a specialist.
What about a property owned by my company?
Company or trust-owned property can be used as security. The entity must be authorised to give security, and its directors or trustee will sign.
Does the property need to be in a capital city?
No, but properties in smaller towns may attract lower loan amounts because there are fewer buyers and comparable sales.