The valuation came in under the price, and there are several ways to fund the gap.
- An indicative assessment within 2 business days of receiving the contract, the valuation and your figures; settlement timing depends on the lender and the security
- Loans from $100K to $10M to cover a valuation gap on a commercial purchase
- Business owners, companies and investors buying shops, offices, warehouses, industrial units or a business with its premises
- Covers a gap funded by a second lender, a larger loan against extra security, or a replacement loan from a lender with a different valuation
- Full-doc (tax returns), low-doc or alt-doc (BAS, bank statements or an accountant's letter instead) and no-doc options, depending on the security offered
You signed at a price you were comfortable with, the lender's valuer reported a lower figure, and settlement is close. The loan you were counting on is now smaller than planned, and the difference has to come from somewhere before the settlement date. A commercial settlement shortfall can usually be closed in more than one way: a further valuation, more of your own funds or equity, a second lender for the gap, or more time agreed with the vendor through your solicitor. Each has a different cost and a different timeline. Joseph Farhat and his team can lay those options out against your date and approach the lenders that suit the one you choose.
Who we can help access finance
- Business owners buying their own premises whose lender valued the property below the agreed price.
- Investors buying a tenanted shop, office or industrial unit where the valuer read the leases or the yield differently from the agent.
- Companies buying a business together with its freehold, where the property valuation left the loan short of the purchase price.
- Buyers with equity in another commercial or investment property who can offer it as extra security for the gap.
- Self-employed buyers who could fund the gap from business cash flow over time but not in one payment by settlement.
How Commercial Settlement Shortfall Finance Works
Many lenders size a purchase loan on the lower of the valuation and the price. If you agreed to pay $3M and the valuation says $2.7M, a lender lending 65% now offers $1.755M instead of $1.95M, about $195K less. The shortfall is the amount between what the lender will now advance and what you need at settlement.
There are four common ways to close it. A further valuation can be requested, or a different lender may instruct its own valuer, although a second figure can come in the same or lower. You can put in more cash, or offer equity in another property as extra security so the main loan can stay at the size you need. A second lender can fund the gap, for example through a second mortgage over other property you own. Or your solicitor can ask the vendor for more time while the finance is rearranged. Whether the vendor agrees is up to the vendor. Joseph Farhat and his team compare these routes across our 90+ bank, non-bank, and specialist panel, and for unique scenarios we can introduce you to private finance options.
The contract sets out what happens if you cannot settle. In NSW, the 2026 edition of the Law Society and REINSW contract uses the 42nd day as the default completion date. It allows a notice to complete to be served but does not set the notice period, and 14 days is common practice. If a buyer defaults, the vendor can end the contract, keep a deposit of up to 10% and claim damages. We are a finance broker, not a lawyer or tax adviser. Your solicitor confirms your position under the contract, and your accountant confirms how GST applies to the price.
What Lenders Assess for Commercial Settlement Shortfall Finance
The valuation report
the figure, the comparable sales and lease evidence the valuer used, and whether a further valuation is likely to differ.
Days to settlement
whether a new valuation, an approval and a settlement booking can fit before the contract date.
Total LVR
the loan-to-value ratio (LVR), the loan as a share of the property's value, across the purchase and any extra security offered.
Your contribution
the deposit paid, funds held for duty and costs, and where any extra cash is coming from.
The leases and the tenants
lease terms, rent and tenant quality drive the value of an investment property and how a lender views it.
Additional security
equity in other property you own, its existing mortgage and whether that lender will consent to a second loan.
The plan for any short-term loan
if the gap is funded short term, how it is repaid, for example from business income, a sale or a later refinance.
The Commercial Settlement Shortfall Process: What to Expect
- Send Joseph Farhat and his team the contract, the valuation, your approval and the settlement date. You hear quickly which options look achievable before the date.
- Your solicitor confirms the completion date, the contract terms on default and whether the vendor will consider more time. Your accountant confirms the GST position.
- We approach the lenders that suit the option you choose, and you usually receive an indicative assessment within 2 business days. Each credit enquiry is recorded on your file, so we go to the most suitable lender first.
- The lender values the purchase and any extra security, then issues an approval. We go through the rate, fees and conditions with you and keep both solicitors updated on timing.
- The loan settles and the purchase completes. Where a short-term loan funded the gap, work on repaying or refinancing it starts straight away.
Indicative Finance Options
| Lender Type | Indicative Rate | Max LVR | Typical Loan Range | Loan Term | Speed to Funding |
|---|---|---|---|---|---|
| Bank | From ~6.75% p.a. | Up to 70%, more with extra security | $250K to $10M | 3 to 15 years | 3 to 8 weeks |
| Non-Bank Lenders | From ~8.75% p.a. | Up to 75% | $100K to $10M | 1 to 25 years | 1 to 3 weeks, once the valuation is in |
| Private Finance | From ~1.2% per month | Up to 75% | $100K to $10M | 1 to 24 months | Available for unique scenarios |
Indicative figures only. Actual rates and terms depend on your project, financial position, property location, and lender assessment at the time of application. Rates are subject to change.
Why borrowers choose Settled With Joe for commercial settlement shortfall finance
We represent you, not the lender
Joseph Farhat and his team act for you from the day the valuation lands until the purchase settles.
Every option compared, not just a loan
a further valuation, extra security, a gap loan and more time from the vendor are set out side by side with cost and timing.
We read the valuation with you
the comparable sales and lease figures the valuer used help show whether another lender may see the property differently.
One conversation, not several applications
each credit enquiry is recorded on your file, so the first lender approached should be the right one.
90+ lenders on one panel
bank, non-bank, and specialist, so a purchase with clean financials and time left may suit a bank at a sharper rate, and a close date still has other routes.
We work alongside your solicitor and accountant
they handle the contract and the GST, and we handle the lenders, on one shared timeline.
Private finance for unique scenarios
where bank and non-bank lenders are not the right fit, we can introduce you to private finance options.
Usually no direct cost to you
as a broker we are typically paid by the lender on settlement.
An honest answer early
if the valuation arrived this week and settlement is close, tell us early and we will tell you what is realistically achievable.
Frequently asked questions
What is commercial settlement shortfall finance?
It is finance arranged to cover the gap that opens when a commercial purchase values below the contract price. Many lenders lend against the lower of the valuation and the price, so a low valuation shrinks the loan while the price stays the same. The gap can be funded by a larger loan against extra security, a second loan from another lender, or a replacement loan from a lender whose valuation supports more. This page covers commercial property and business purchases by business owners, companies and investors.
Can I ask for another valuation?
You can ask your lender whether it will order a review or a further valuation, and a different lender will usually instruct its own valuer. A second valuation can come in higher, the same or lower, and it adds time. Comparable sales, rent and lease terms in the first report show what the valuer relied on. Joseph Farhat and his team will tell you which lenders value the property type quickly.
What happens if I cannot settle on time?
That depends on your contract. Under the NSW 2026 standard contract, a party who is entitled to can serve a notice to complete, and 14 days is the period commonly used. If the buyer then does not complete, the vendor can end the contract, keep a deposit of up to 10% and claim damages. Your solicitor can confirm your position and ask the vendor for more time. Whether the vendor agrees is the vendor's decision. Our notice to complete finance page covers the steps once a notice has been served.
Can I use equity in another property to cover the gap?
Often, yes. Offering a second property as extra security can let a lender keep the main loan at the size you need, or a second lender can fund the gap secured on that property. If the other property already has a mortgage, its lender may need to consent. If the extra security is your home, it is at risk if the loan is not repaid, so get independent legal advice before you sign. Our second mortgage business loans page explains how a loan behind an existing mortgage works.
How does GST affect the amount I need at settlement?
The seller of commercial premises is generally liable for GST on the sale, and the margin scheme may apply. A sale can be GST-free as a going concern only if all the conditions are met, including that the buyer is registered or required to be registered for GST and both parties agree in writing that it is a going concern. The ATO states that the sale of a property by itself is not a going concern. The rule that makes a buyer pay part of the price straight to the ATO at settlement covers new homes and potential residential land, not commercial property. Whether the price includes GST changes what you need on the day, so check the contract with your accountant and solicitor.
Is this available for business purchases as well as property?
Yes, where the business purchase includes property or where you can offer property as security. The valuation of the premises, any extra security and the business's trading figures all shape what a lender will advance. A business bought without property is assessed differently, and our business acquisition finance page covers that.
Can I get commercial settlement shortfall finance with low-doc or no-doc?
In many cases. Non-bank lenders on the panel assess low-doc or alt-doc applications on BAS, bank statements or an accountant's letter, and some commercial lenders consider no-doc loans at a lower LVR. Less paperwork usually means a higher rate and a smaller loan against the security. Joseph Farhat and his team will set out both paths against your date.
Do you work with borrowers with bad credit?
Yes, we do. A default, arrears or a judgment on your file does not rule out finance for a valuation gap. For a shortfall, lenders look first at the valuation evidence, the deposit already paid, any extra security and the days left before settlement. Some lenders on our panel give those more weight than the credit file and set the rate to reflect it. Because the date is fixed, mention any listing in the first conversation, so the file goes to a lender that accepts it and no time or enquiries are lost. Joseph Farhat and his team will give you a plain answer on what is possible before your settlement date.
Why work with Settled With Joe to arrange your commercial settlement shortfall finance?
One call to us replaces a round of applications while the settlement date gets closer. Most of the people we help with a shortfall are business owners, company directors and commercial investors whose purchase was on track until the valuation: a premises purchase now short by a few hundred thousand, a tenanted building valued on a lower yield, or a business bought with its freehold where the loan no longer covers the price. There is no judgement in that conversation. What lenders weigh is the valuation evidence, your contribution, any extra security and the days left. Our panel covers 90+ bank, non-bank, and specialist lenders, so a well-documented purchase can still go to a bank at a sharper rate, and a tight date has other routes. We are based in Sydney and help buyers in every state. Joseph Farhat and his team will tell you early and honestly which options can work before your date.
Do you give financial advice?
No. We do not guide you on your finances, nor give financial advice. We focus on outcomes and solutions of presenting your unique scenario to the right lender so you can access funding in a timely and compliant manner.
Do you help with commercial settlement shortfall finance outside Sydney?
Yes. Settled With Joe is based in Sydney and arranges commercial settlement shortfall finance Australia-wide, covering both metro and regional areas. We work with clients in Sydney, Melbourne, Brisbane, Perth, Adelaide, and Canberra, as well as regional areas including Newcastle, Wollongong, Geelong, Gold Coast, Sunshine Coast, and Toowoomba. Contract terms differ between states, and regional commercial property can take longer to value. Joseph Farhat and his team will identify which lenders on the panel can work to your settlement date.
