Commercial Property Loan Rates Australia 2026
Commercial property loan rates Australia 2026 for non-bank borrowers – Switchboard Finance
Property Lending
Commercial property · Rates and margins · Reviewed August 2026
Commercial Property Loan Rates Australia 2026
No regulator publishes a market-wide average for commercial property loans, because every facility is priced to its own file. This guide gives the current official figures with their limits, shows what the published lender rate cards actually say, and walks you through reading your own facility.
Quick Answer
Commercial property loan rates in Australia are set file by file, not published as a market average. Your rate is a benchmark plus a lender margin, then fees and how the facility resets, so total cost over your hold period matters more than any headline. See how commercial property loans work or the commercial property loan page.
What is a good commercial property loan rate in 2026?
A good commercial property loan rate is the lowest total cost and best overall fit for your structure and the period you expect to hold the loan, not simply the lowest advertised percentage. No regulator publishes a market-wide average specifically for Australian commercial property loans, so treat any single headline figure with caution and compare complete offers instead. If you want the fundamentals first, see how commercial property loans work, or talk to us about a commercial property loan.
For wider context, the RBA cash rate target is 4.35 percent, held unchanged at the 11 August 2026 meeting. That is the policy rate the Reserve Bank sets, not the rate on a commercial facility, and commercial rates need not move immediately or one for one with it. The Reserve Bank does publish average business lending rates across all business borrowing, and they are a useful backdrop, but read the qualifier carefully: they are not commercial-property-only rates, and they are not an offer.
What do the latest RBA average business lending rates show by business size? Indicative backdrop only, not commercial property rates.
Basis: RBA Lenders' Interest Rates, Table F7, latest published data, sources APRA and RBA, accessed 23 August 2026. These are averages across all business lending, fixed and variable rates and all industries combined. They are not commercial-property-only rates, not non-bank or private rates, and not an offer you can apply for. The cash rate context is from the RBA cash rate target page, accessed the same day.
The more useful figure is the gap between those averages and the cash rate, because that is the part that reflects lending, not policy. The Reserve Bank does not publish the gap, but it publishes both numbers, so it can be worked out. Business borrowers usually want to know two things: how far above the cash rate a business loan actually sits, and why it costs more than the mortgage on their house. The table answers both from published figures.
How far above the cash rate do Australian business and housing loan rates actually sit? Calculated from RBA Tables F6 and F7 against the 4.35 percent cash rate target, accessed 23 August 2026.
On a phone, swipe the table sideways to compare every column.
Read straight, that says the average small business borrower pays 2.56 percentage points above the cash rate, more than three times the 0.78 point gap a large business pays, and 1.39 percentage points more than an owner-occupier home loan. Size is the visible pattern: the gap narrows as the borrower gets larger, which is what you would expect if the gap is mostly risk and cost to serve.
Four limits on that arithmetic, and they matter. The gap is not a margin: it is the distance between two separately published figures, and no lender prices by subtracting the cash rate from an average. The F6 and F7 figures are monthly averages published 25 business days after month end, so they always lag the current policy setting. Both tables cover all business and all housing lending, so neither is a commercial property figure. And these are averages of existing loans, many written years ago on terms unrelated to today's market. Calculated by Switchboard Finance from RBA Tables F6 and F7 and the RBA cash rate target, both accessed 23 August 2026. Indicative context, not a quote or an offer.
What the published non-bank rate cards say right now. This is the comparison the official tables cannot give you, because the RBA does not publish a commercial property series. These are advertised card rates from lender broker guides, not quotes, and each row carries the date of the guide it came from.
Read the pattern, not the individual number. Card rates step up roughly 0.30 to 0.40 percent for every ten points of LVR above 60 percent, alt doc and lease doc sit above full doc at the same LVR, and the maximum LVR itself falls as the documentation thins. Figures are the lenders' published broker guides at the dates shown, they are indicative, they change without notice, and none of them is an offer to you. Bank pricing is not in the table because no Australian bank publishes a commercial property rate card.
Are commercial property loan rates rising in 2026?
The cash rate target entered 2026 at 3.60 percent and is now 4.35 percent, a rise of 0.75 percentage points in three steps, and it has been on hold since June. The Reserve Bank raised the target by 0.25 percentage points effective 4 February 2026 to 3.85 percent, again effective 18 March 2026 to 4.10 percent, and again effective 6 May 2026 to 4.35 percent. At its meeting on 16 June 2026 the Board left the target unchanged, and at its meeting on 11 August 2026 it left the target unchanged again at 4.35 percent. The next scheduled decision is 29 September 2026.
In the August 2026 Statement on Monetary Policy the Reserve Bank said inflation is not expected to return to the middle of the target range until early 2028. That is a statement about the policy outlook, not a forecast of your loan rate, and it is not a prediction of the September decision.
A policy-rate move reaches a commercial facility through funding costs and through your own contract, and those do not share a date. A variable facility that reprices only at its contractual reset will not move on the day of an announcement, and a margin locked for a term does not widen because a benchmark moved. Confirm which benchmark your facility uses, its tenor, and when it resets before you draw any conclusion about direction.
What has the RBA cash rate target done in 2026, decision by decision? RBA cash rate target and monetary policy decisions, accessed 23 August 2026.
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Basis: RBA monetary policy decisions and the RBA cash rate target page, both accessed 23 August 2026. Nothing here is a forecast, and the next decision is a scheduled date rather than a prediction of its outcome. What a tightening or easing backdrop actually means for your facility depends on your benchmark, your reset dates and your margin. If a reset or a maturity is coming, start with our read on refinancing and interest-only structures, or see the property lending hub for the wider picture.
Which commercial property loan rate questions matter for your situation?
The rate drivers that deserve your attention depend on why you are borrowing. Start with your transaction, then compare the factors that can actually change lender fit, total cost and the chance of the deal proceeding.
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A borrower searching for a rate is often really asking one of three questions: Can I qualify, what will the loan cost over the period I need it, and what could stop the transaction? Answer those before treating any headline percentage as meaningful.
How is a commercial property loan rate calculated?
A commercial property loan rate is built from a benchmark or reference rate plus a lender margin, then shaped by fees and the way the facility resets. The Reserve Bank notes that variable business loans usually reference short-term rates such as the cash rate or BBSW, while new fixed business rates generally follow tenor-matched swap rates. Bank funding costs, competition and the lender's assessed credit risk also influence the rate, so two borrowers can be quoted differently on the same day.
Timing matters too. Some benchmark-linked facilities reprice only at contractual intervals, so a cash rate change may take longer to flow through to an outstanding rate, and it need not pass through one for one. A variable rate can change at each contractual reset, while a fixed rate holds for a set term. BBSW, the bank bill swap rate, is a short-term Australian dollar benchmark whose value depends on the tenor and the fixing date, so there is no single undated BBSW number to quote. On the ASX ten day rolling history at 20 August 2026, one month BBSW was 4.3108, three month was 4.5026 and six month was 4.7911. Those are benchmark fixings on one date, not loan rates, and your facility adds a margin on top.
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How do banks, non-banks and private lenders price differently?
Banks, non-banks and private lenders price from different funding models and risk appetites, so the lowest headline rate and the best fit for your situation are not always the same lender. The two tables below compare the pricing basis. Banks are APRA-regulated deposit takers and usually suit strong, standard files with full documentation. Non-bank lenders fund differently and often offer more flexible policy, including lease-doc options. Private lenders concentrate on short-term or specialist situations.
On a phone, swipe the table sideways to compare every column. Rate cards for the non-bank column are the published broker guides listed earlier on this page, at the dates shown there.
What borrower, lease and security factors affect the margin?
The margin reflects how risky the lender considers the loan. Lower leverage, strong serviceability, standard security and a solid lease can support a tighter margin, while the opposite can widen or complicate it. There is no universal LVR cut-off, deposit rule or minimum lease length that applies to every lender.
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Can you borrow 80 percent against commercial property?
Eighty percent is reachable on published non-bank guides, but only on the right file, and any figure quoted without your file attached is a guess. Three lender guides read this month all cap full doc at 80 percent LVR, and all of them price that top tier well above their own 50 to 65 percent tiers: on one August 2026 card, full doc runs from 7.69 percent at 50 percent LVR to 8.84 percent at 80 percent. Thinner documentation lowers the ceiling as well as raising the rate, with quick doc capped at 65 percent and lease doc at 70 percent on those same guides. Figures are the lenders' published broker guides at the dates shown earlier, indicative and subject to change.
For APRA-regulated lenders the ceiling is set differently again. APS 220 requires an ADI to establish appropriate limits on LVR and to ensure there is appropriate scrutiny of any lending at high LVR, so the ceiling is a lender-by-lender policy setting rather than a market rule, and it moves with the security, the repayment source and the evidence. Standard, marketable security with strong evidenced serviceability sits in a different place from specialised security on limited documentation, at the same requested LVR. The honest answer is that the number you can borrow is an output of your file, not an input you can look up. Our 80 percent LVR guide covers what it takes to reach the top tier, and the deposit guide covers the cash side.
Lenders measure repayment capacity in different ways, including debt service and interest cover ratios; the definitions and policies vary by lender, so ask which measure applies and how you are assessed. Our DSCR glossary entry explains the common one. For APRA-regulated lenders, APS 220 requires independent collateral valuation processes that reflect fair value and prevailing market conditions, regular reassessment of collateral, and appropriate LVR limits. Those are obligations on the lender, not a single customer LVR maximum that applies everywhere.
Lease strength matters for investment security. APRA's guidance in APG 112 says that, where a commercial exposure depends on property cash flows, the tenancy profile should be assessed relative to loan maturity, and with multiple tenants a lender may consider whether the weighted average lease expiry sufficiently exceeds the loan term. That is credit-risk guidance, not a universal minimum WALE. For the detail, see how a valuation is handled when a property is under contract, how specialised security is valued, and how lenders read a lease.
How does bank capital reach your commercial property loan margin?
For an APRA-regulated lender, your file is classified before it is priced, and the classification changes how much capital the loan consumes. Capital is a funding input, so the classification can reach your margin. That is the mechanism sitting underneath the usual advice that LVR, lease and serviceability affect the rate. It applies to ADIs. A non-bank or private lender is not bound by these standards and prices to its own funding and risk model, which is one reason the same file can be quoted very differently across the three channels.
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Basis: APRA Prudential Standard APS 220 Credit Risk Management, in force 1 January 2023, and APRA Prudential Practice Guide APG 112, both accessed 23 August 2026. These are obligations and guidance directed at APRA-regulated lenders, summarised here and not reproduced in full, and none of them is a customer rule you can apply to your own file.
Full doc, alt doc or low doc: what changes?
Your documentation level does not change the cash rate. It changes the margin on top of it, and it changes which lenders will look at you at all. The cash rate target is 4.35 percent for every borrower in Australia. What differs between a full doc file and an alt doc file is the evidence you can produce, how the lender calculates serviceability from it, and therefore the risk it prices. That is why comparing an alt doc quote against a headline full doc rate is comparing two different files, not two prices.
On a phone, swipe the tables sideways to compare every column. LVR ceilings and loadings are from the published lender broker guides dated earlier on this page, they are indicative, and they change without notice.
On the rate difference between them, be careful what you believe. You will find doc-level rate differentials quoted online, usually as a range. Very few of them come from a published lender source. No Australian lender publishes a commercial property rate card by documentation level across the whole market, and no regulator publishes an average by documentation level either, which is why the RBA's Table F7 stops at business size. Most published ranges are a broker's observation of their own lender panel. That is real information and often useful, but it is not a rate card, and it will not tell you what your file gets.
There is a prudential reason full doc tends to price better, and it is not arbitrary. APS 220 requires an ADI to assess credit risk primarily on the strength of the borrower's repayment capacity, and to obtain adequate information to undertake a comprehensive credit assessment. Less evidence does not make a file less risky in reality; it makes the risk less measurable, and an unmeasured risk gets priced. That is also why moving from alt doc to full doc is sometimes the cheapest thing a borrower can do, and why the honest first question is not what rate you can get, but which documentation level you can actually reach this quarter. Our lease doc guide covers the middle option in detail.
What information do you need for a meaningful commercial property loan rate quote?
A meaningful rate quote needs enough information to price both the borrower and the security. A percentage given without the loan purpose, amount, property, LVR, repayment source, documentation, term and timing is usually a headline indication rather than a decision-ready comparison.
On a phone, swipe the table sideways to compare every column.
A broker or lender can often narrow the likely pathway from a concise scenario summary, but an indicative rate is not an approval. Pricing and terms may change after documents are checked, the property is valued, credit assessment is completed and the lender issues its final offer.
Do owner-occupied and investment properties price differently?
They can, but not in a fixed direction. The real difference is the repayment source and how much the lender relies on lease income, not a blanket rule that one is always cheaper than the other.
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Because the risk sits in different places, the same borrower can be priced differently on an owner-occupied purchase and an investment purchase. See our reads on owner-occupier commercial property loans and on buying versus leasing your premises.
Is a fixed or variable commercial property loan rate better?
Neither is automatically better. A fixed rate gives repayment certainty for a term but can carry a break cost if you repay or exit early, while a variable rate can move at each reset, in either direction. The choice depends on how long you intend to hold the facility, how comfortable you are with the repayment moving, and whether you expect to refinance.
Break costs are not a set amount. They are calculated from wholesale rate movements across your remaining fixed period, and they can be modest or substantial depending on timing. Before you fix, ask the lender to explain the break-cost calculation method in writing. If an interest-only period or a refinance is in your near future, read our guide on refinancing and interest-only expiry first.
What does a rate change actually do to your repayment?
Work the arithmetic before you work the anxiety. On an interest-only balance, the extra interest from a rate change is the balance multiplied by the change. Running your own numbers usually shows the figure is smaller than you feared, and occasionally that it is much larger.
How much extra interest does a rate rise cost per year, by loan size? Illustrative arithmetic only, interest-only, before fees.
On a phone, swipe the tables sideways to compare every column.
Illustration only, and not a quote, an offer or a prediction of any rate movement. It is straight multiplication of balance by rate change, on an interest-only basis, before fees, with no compounding, no day-count adjustment and no principal reduction. A principal-and-interest repayment changes differently, because the amortisation period matters as well as the rate. To get a monthly figure, divide by twelve: on an illustrative 1,000,000 dollar balance, a 1.00 percentage point rise is about 10,000 dollars a year, or roughly 833 dollars a month, before fees.
Two things this arithmetic cannot tell you, and both matter more than the number. When it applies to you depends on your reset date, not on any announcement date. Whether it applies at all depends on whether your rate is fixed, whether your margin is locked, and what your contract says. Read the next section against your own facility.
Is my commercial property loan rate too high?
You cannot answer that against a headline. You can only answer it against your own file. A rate is not inherently high or low; it is high or low relative to what a comparable file would be quoted today, and no published average knows your LVR, your lease or your evidence. Instead of comparing your rate with a number you read somewhere, establish what your own file actually shows. Then the comparison becomes possible.
Everything in the table below sits in a document you already have. Most borrowers who think their rate is uncompetitive have never read all ten rows.
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Once you have those ten, you have a file rather than a number, and a file can be compared. That is the point at which a broker or another lender can tell you something useful, and the point at which asking your current lender whether the margin can be reviewed is a conversation rather than a request. If your position has genuinely improved since the facility was written, that is the evidence you would put in front of them. Send us the file and we will tell you where it sits.
Which fees belong in the all in cost?
Compare the total dollar cost over the period you expect to hold the loan, including every fee, not just the interest rate. A lower headline rate with heavier fees can cost more than a slightly higher rate with light fees, especially on a short hold.
On a phone, swipe the table sideways to compare every column. Fee figures are from the published lender broker guides dated earlier on this page, they are indicative, they vary by lender and product, and they change without notice.
One more comparison point: a statutory consumer comparison rate is designed for consumer credit, so it is not generally a like-for-like tool for business-purpose commercial finance. Moneysmart explains what a comparison rate is in a consumer context. Rather than rely on it, ask each lender for a full schedule of interest, fees, break costs and repayments so you can compare the total cost. This is general information, not legal advice. When you are ready, we can help you compare offers on a commercial property loan.
How do you turn a commercial property loan rate quote into a decision?
Turn a rate quote into a decision by comparing the complete facility over the period you expect to use it, then checking the terms that could change your repayments, flexibility, refinance options or ability to settle.
Do this before you sign
- Separate the benchmark from the margin, and confirm the reset frequency and whether the margin can be reviewed during the term.
- Model the cost over your expected hold period, including interest, establishment, valuation, legal, annual, exit and break costs.
- Test the repayment structure, comparing interest-only and principal-and-interest, and confirm any balloon or residual balance.
- Stress the repayment against a higher benchmark, the end of an interest-only period, and a refinance that takes longer than planned.
- Read the control terms: covenants, revaluation rights, reporting, guarantees and events that allow repricing.
- Check the exit before entering: discharge, early repayment and break terms, plus the practical refinance or sale path at maturity.
- Separate indicative terms from approved terms, and record what still depends on documents, valuation or credit.
What goes wrong without it
- Comparing a bank quote with a non-bank quote as if they were the same number.
- Choosing on first-year rate and discovering the fees on a two-year hold.
- Fixing without asking how the break cost is calculated.
- Assuming the rate moves on the announcement date rather than the reset date.
- Missing a covenant or revaluation right that lets the lender reprice you later.
- Finding the exit cost only when you try to refinance.
- Treating an indicative rate as an approval and committing to a settlement date.
What usually happens after you choose a lender pathway?
The sequence is fairly consistent across lenders, even though the detail varies. Scenario fit comes first, where the borrower, property, purpose, amount, timing and available documents are matched to a suitable lender pathway. Then indicative comparison, where the likely rate structure, fees, LVR, term, repayment type and key conditions are compared on a consistent basis.
After that comes evidence and valuation, where the lender reviews the required documents and normally arranges or accepts a valuation under its policy. Then formal assessment, where credit, property, entity, legal and any lease issues are assessed before a final approval or offer is issued. Finally documents and settlement, where loan and security documents are completed, conditions are satisfied and the facility proceeds to settlement or refinance.
The exact sequence varies by lender and transaction. The practical goal is to expose the important questions early, before valuation, legal work and a looming settlement date make changing direction more expensive.
Can you negotiate, reprice or refinance the rate?
Sometimes. What you can change depends on your facility terms, your current risk position, and whether a refinance genuinely improves the total cost. Your contract, not the headline market, controls when a rate is reviewed or repriced.
A practical review checklist: confirm your reset dates and how the benchmark is applied; ask whether the margin can be reviewed if your risk position has improved; check discharge, exit and break costs before you move; and get a fresh valuation view, because a revaluation can change your LVR and your leverage. Watch any loan covenants, since a breach can have consequences that depend entirely on the facility terms. If a refinance looks worthwhile, our read on refinancing and interest-only walks through the triggers, and our deposit and LVR guide covers how equity affects pricing.
What triggers an annual review or a margin reset?
Most commercial facilities are reviewed annually, and the review is the moment your margin can move without the cash rate moving at all. This is the part of commercial mortgage rates that borrowers find out about late, usually in a letter. The common triggers are a covenant test at review date, a revaluation that shifts your LVR band, a lease expiry or a tenant change that alters the security's income, a change in your reported serviceability, and the roll of a facility from interest-only to principal and interest.
The economics of a refinance turn on the exit and entry costs, not on the headline saving. On the published guides dated earlier on this page, establishment costs sit around 0.85 to 1.00 percent of the loan, one lender offers a 1.50 percent option that removes the early repayment fee, and early repayment fees of about 2 percent can apply inside the first three years. Against those, a margin improvement of 0.25 percent on a 1,000,000 dollar facility is about 2,500 dollars a year, so a move that costs 1 percent to execute takes roughly four years of that saving to repay. Work the payback period before you move, and remember that a shorter remaining hold makes the fees hurt more, not less.
Ask for the review before it is served on you. In our experience a repricing request lands better with a current valuation, a clean rent roll and evidence of another lender's appetite than it does after a margin has already been reset. If you are weighing whether to refinance commercial property rates rather than argue them, price both paths side by side, including the discharge, and check what your existing lender will do once it knows you have an alternative.
From our broking, indicative
Across the commercial property enquiries we see, the files that attract tighter pricing tend to share a few features, and the ones that widen or complicate pricing share the opposite. The pattern is consistent even though the numbers are not.
- Tighter pricing tends to follow lower leverage, strong and well-evidenced serviceability, standard and marketable security, a credible tenant and lease profile, clean documentation, a clear purpose and a sensible term.
- Wider or more complicated pricing tends to follow higher leverage, specialised or thinly traded security, a short or mismatched lease, weaker serviceability, limited documentation, adverse credit, urgent timing and an unclear exit.
- The same headline rate can produce a very different total cost once establishment, valuation, legal, annual, exit and break costs are included.
- A good rate is the best all in fit for your structure and intended hold period, not automatically the lowest advertised percentage.
Broker-observed and indicative only, as at 23 August 2026, from Switchboard lender-panel and quote-book observations across commercial property enquiries. No rate figure is quoted here because our own panel observations are not a published source; every percentage on this page comes from a named lender guide or a regulator, with its date beside it. Not a quote, an offer, an approval indication, a rate promise, a savings claim or a forecast. Actual pricing depends on the borrower, property, lease, valuation, LVR, serviceability, documentation, facility structure, lender policy and market conditions at the time of application.
What sources support this guide?
This guide is built on primary sources: the Reserve Bank of Australia for the cash rate and business lending context, APRA's prudential standard and guidance for how ADIs assess collateral, classify property exposures and read leases, the ASX for BBSW, published lender broker guides for card rates and fees, and Moneysmart for the limits of consumer comparison rates when assessing business-purpose commercial finance. Each was read again for this update, and every dynamic figure is shown with its source and date beside it.
On a phone, swipe the table sideways to compare every column.
Regulatory positions are summarised, not reproduced in full, and none of this is legal, tax or financial advice. Lender card rates are the lenders' own published broker material, are indicative, and change without notice. Dynamic figures such as the cash rate, the business lending averages and BBSW can change, and your own facility and quote govern, so confirm the detail with the current source pages and your lender or broker before you act.
There is no published average commercial property loan rate in Australia, and the numbers that are published are answering a different question. The cash rate is 4.35 percent, held on 11 August 2026, and it is a policy rate. The RBA business averages cover all business lending, not commercial property. The published non-bank card rates, running from about 7.69 percent at low LVR to the high eights at 80 percent on guides dated July and August 2026, are the closest thing to a market view, and even those are advertised rates rather than your rate. What you actually pay is a benchmark plus a margin set by your leverage, your evidence, your security and your lease, then fees, then the way the facility resets and reviews.
Key takeaway: read your own facility for the ten things in the file-reading table, and you will know whether your rate is competitive far better than any headline percentage can tell you.Frequently Asked Questions
There is no single best rate, because no regulator publishes a market-wide average specifically for commercial property loans and every facility is priced to its own risk. For context, the RBA cash rate target is 4.35 percent, held unchanged at the 11 August 2026 meeting, and average business lending rates were 6.91 percent for small business, 5.55 percent for medium and 5.13 percent for large. Those are economy-wide business lending figures, not commercial property rates. The best rate for you is the lowest total cost, interest plus fees plus break costs, over the period you expect to hold the loan. See commercial property loans for the product view.
The policy backdrop tightened in the first half of 2026 and has since been on hold. The RBA raised the cash rate target three times before June, and the Board left it unchanged at 4.35 percent on both 16 June and 11 August 2026. The next scheduled decision is 29 September 2026. That does not automatically mean your loan rate rises, because a variable facility only moves at its contractual reset date rather than on an announcement date, and a fixed rate holds for its term. Check your reset and refinance position before assuming anything.
You cannot answer that against a headline, only against your own file. A rate is high or low relative to what a comparable file would be quoted today, and no published average knows your LVR, your lease or your evidence. Establish ten things from documents you already hold: your benchmark and reset date, your margin and whether it is locked, your remaining fixed term and break method, your LVR on a current valuation, your repayment source, your lease against loan maturity, your documentation level, your channel, your annualised fees and your covenants. Then the comparison is real.
On the latest published RBA figures against the 4.35 percent cash rate target, small business loans average 6.91 percent, a gap of 2.56 percentage points, medium business 5.55 percent, a gap of 1.20 points, and large business 5.13 percent, a gap of 0.78 points. Owner-occupier housing averages 5.52 percent, a gap of 1.17 points. Those gaps are the distance between two separately published figures, not lender margins, and none of them is a commercial property figure.
Generally yes, but the cash rate is the same either way. Documentation level does not change the benchmark, it changes the margin on top and which lenders will look at you at all. Published broker guides show the pattern: on one lender's August 2026 card, prime full doc starts at 7.79 percent at 65 percent LVR while alt doc at the same tier starts higher, and lease doc sits between them. No lender publishes a full commercial rate card by documentation level across the market, so treat any market-wide doc-level differential as a broker observation rather than data. See our lease doc guide.
Usually as a benchmark or reference rate plus a lender margin, then adjusted for fees and how the facility resets. Variable facilities typically reference short-term benchmarks such as the cash rate or BBSW, while new fixed rates generally track tenor-matched swap rates. Funding cost, competition and the lender's assessed credit risk all feed the margin, so two borrowers can be quoted differently on the same day and there is no universal formula.
No. The cash rate target, currently 4.35 percent, is the Reserve Bank's policy rate, not your loan rate. It influences funding costs and can flow through to lending rates, but commercial rates need not move immediately or one for one, and many facilities only adjust at a scheduled contractual reset rather than on the announcement date.
BBSW, the bank bill swap rate, is a short-term Australian dollar benchmark used as the reference rate for some variable business facilities. Its value depends on the tenor and the fixing date, so there is no single undated BBSW number. On the ASX ten day rolling history at 20 August 2026, one month BBSW was 4.3108, three month 4.5026 and six month 4.7911. Those are benchmark fixings, not loan rates, and your facility adds a margin on top. Confirm which tenor and reset basis your contract uses.
Loan to value ratio is one pricing input among several. Lower leverage generally reduces the lender's risk and can support a tighter margin, while higher leverage widens it. Published non-bank guides show the step clearly: on one August 2026 card, full doc pricing runs from 7.69 percent at 50 percent LVR to 8.84 percent at 80 percent. APS 220 requires an APRA-regulated lender to set appropriate LVR limits and scrutinise high LVR lending, so the ceiling is lender policy, not a market rule. See our 80 percent LVR guide.
They can differ, but not in a fixed direction. The real difference is the repayment source: owner-occupied premises are repaid mainly from business cash flow, while an investment property relies on lease income. Tenant strength and lease term carry more weight on investment security. APRA guidance treats an SME loan secured by commercial property but serviced from business revenue as a different exposure from one dependent on property cash flows, so it is not true that owner-occupied always prices lower.
Yes, substantially. Standard, marketable property in a location with real depth of demand, a credible tenant and a lease that comfortably exceeds the loan term tend to support tighter pricing. Specialised or thinly traded property, a short or mismatched lease and material vacancy widen or complicate it. APRA guidance requires a lender to assess the tenancy profile against loan maturity, but there is no universal minimum lease length you can look up.
Include establishment, valuation, legal, annual or line, discharge or exit fees and any fixed rate break cost alongside the interest rate. Published guides put establishment costs in the region of 0.85 to 1.00 percent of the loan, with one lender offering a 1.50 percent option that removes the early repayment fee, and early repayment fees of about 2 percent inside the first three years. Compare the total dollar cost over the period you expect to hold the loan, because a lower headline rate with heavier fees can cost more on a short hold.
Neither is automatically better. A fixed rate gives repayment certainty for a term but can carry a break cost if you repay or exit early, and the break cost is calculated from wholesale rate movements rather than set in advance. A variable rate can move at each contractual reset, in either direction. The choice turns on your expected hold period, your tolerance for repayment movement and whether you expect to refinance.
Sometimes. What you can change depends on your facility terms and your current risk position. You can ask for a margin review if your risk position has genuinely improved, and you would put the evidence in front of them. Refinancing only stacks up once discharge, exit and break costs are set against the saving: a 0.25 percent improvement on a 1 million dollar facility is about 2,500 dollars a year, so a move costing 1 percent to execute takes roughly four years to repay. Read the refinance triggers first.
It can, depending on your facility terms. A revaluation changes your LVR and your leverage even when the loan amount has not changed, and some facilities allow a margin review or other consequences if a covenant is breached. None of it is automatic. It depends on what the facility agreement says and on the lender's decision, so read the covenants and revaluation rights before you assume either way.
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