Getting Finance Ready
- Anthony Mazza
- Jan 2
- 3 min read
Preparing for borrowing isn’t just about ticking boxes; it’s about strategy, timing, and clear communication. Whether you're an individual investor or a business, the right preparation now can make all the difference in securing finance when you need it most.
Here’s how to get ahead:
1. Planning Starts at Tax Time
At year-end tax planning, the first question should always be clear: Are your accounts being prepared for borrowing purposes, or is the focus solely on minimizing your tax obligations? This decision is critical. Banks typically assess the past two financial years of data when reviewing loan applications. Once year-end financials June 30, 2025, for instance are locked, they’re locked. Rushing into borrowing with incomplete financials or last-minute corrections significantly reduces the flexibility to structure your loan in the best way possible.
2. Communicate Early and Often
If you’re considering borrowing in the next 12 to 24 months, inform your advisors now. This gives them time to prepare financials, liaise with brokers or lenders, and ensure everything aligns with your goals. Delays caused by chasing tax returns or preparing interim accounts after speaking to a bank put unnecessary strain on everyone involved—and can cost you opportunities. Let’s make life easier for all parties involved by staying ahead of the game.
3. Pre-Approvals: Your Safety Net
Heading to market without a clear understanding of your borrowing capacity can be risky. Pre-approvals provide clarity on what you can afford, streamline your acquisition process, and prevent stressful surprises—particularly at auctions. Generally valid for three months, pre-approvals are also easy to renew, giving you flexibility and confidence as you shop for investments or assets.
4. Credit Ratings Matter More Than Ever
Your credit rating can make or break a loan application. Missed utility payments or small defaults, often overlooked, are now being flagged by lenders. Defaults don’t just influence approval odds; they can also trigger increased interest rates or reduced borrowing capacity. If your credit report has issues, consulting with professionals to repair your credit may help get you back on track.
5. Understand Returns, Not Just Costs
Whether buying property or investing in assets, you need a complete financial picture, short- and long-term. Are you accounting for cash flow, land tax, and insurance costs? How will rental returns or capital growth stack up over time? Are you prepared for shortfalls or the cost of being cash-flow negative? These considerations help you measure your return on investment (ROI) effectively. Aligning your acquisition strategy with these metrics leads to smarter, sustainable decisions.
6. Strategise Your Loans
A short-term focus on "getting this loan over the line" can derail long-term goals. If your strategy includes multiple acquisitions, ensure your financier is aligned with these ambitions. For example, if you aim to purchase five properties in three years, choose a lender who can work with you holistically to achieve this outcome or communicate any challenges ahead of time. Think strategy; not just transactions.
7. Smart Refinancing and Loan Management
When refinancing, be mindful of how it fits into your overall strategy. Resetting a long-used principal and interest (P&I) loan, for example, could extend your repayment timeline and give banks the upper hand. Avoid refinancing pitfalls by calculating ROI and considering products like interest-only loans or mortgage offset accounts, which help optimize cash flow while managing debt efficiently.
8. The Reality of Loyalty in Lending
The hard truth: loyalty doesn’t carry much weight with banks. If your current lender isn’t offering competitive terms, explore other financing options. Sometimes getting pre-approval elsewhere prompts your existing bank to reconsider its offer. Always prioritise lenders that align with your strategy.
The key takeaways are simple but important: plan early, communicate openly, and keep your big-picture strategy in mind. Whether you’re navigating tax planning, securing pre-approvals, or protecting your credit rating, being proactive saves time, reduces stress, and sets you up for better outcomes.
Need help getting finance-ready? Contact our team to strategise and guide you through your next steps.
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