Commercial Loan Refinance

$2.6m Funding

Sheel was engaged by an agricultural company to provide a solution to refinance a loan secured by farmland. The company is run by a couple with Horticultural qualifications and is located in Shepparton - farming Canola, Wheat and Oat. In addition to the farming opportunities the land offers, it also has two properties that are tenanted to local residents.

Sheel arranged to meet the directors on their farm to understand their income source, what income they expect to generate from farming for FY 2021 and the historical income for FY 2020. We also took into consideration their operations on the farm, the equipment utilised, and the space required to store this equipment.

The couple admitted that they would be able to run their operations smoothly if they built a shed as that would offer working space for the manager on the farm and also space to store equipment. Both the directors hadn’t thought into financing the extra funds to be able to build a shed as they planned to use funds from their working capital. Furthermore, the current banking structure did not provide reliable relationship management support and the directors advised that they would be able to benefit from a relationship manager that could look after their day to day banking needs.

How we helped

Sheel Capital conducted a comprehensive review of their current banking and finance structure, assessing their needs and short/long-term goals in the business. Based on these goals we prioritised three needs that had to be met.

Sheel Capital engaged 4 lenders and requested a quotation and appetite for the transaction. We made the clients aware of the benefit of seeking funding for the shed in addition to the refinance as this would assist the client with taxation benefits and save the working capital in the business.

Once the lender was chosen, the client was requested to provide cash flow projections based on the current crop which included the revenue and expenses. A credit submission was written on the basis of the management history, financials, nature of the security and farming industry in Australia. Certain key indicators that referred to the demand of Australian crops over produce that is imported from Canada was added to the submission. This was to highlight the diminishing quality of the imported yield and emphasise the certainty of the client's revenue for the following year.

The lender was satisfied with the overall submission and a credit approval was granted based on the merits of the information submitted to the lender.

Sheel Capital wins for the client

Our client was very satisfied with the level of advice and financial insight that was provided.

They received:

  1. a better interest rate
  2. increased loan term
  3. additional funding required for building the shed.

They now have a much better understanding of their finance management strategies and have funding that’s competitive in the market.

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