Quick answer
For a caveat loan call, have the property address, the registered owner's full name, what's already owed on the title and to whom, the deadline you're working to, and your exit — the sale, refinance or payment that will repay the loan. Caveat loans are short-term, so the specialist will focus on equity and how and when you'll repay. Ask for total fees in dollars and what an extension would cost.
Key points
- A caveat is a notice lodged on the property's title, used to secure some short-term business loans.
- The exit is the heart of the conversation: how and when the loan will be repaid.
- Have title details, existing mortgages and your deadline in front of you.
- Ask what happens — and what it costs — if the exit runs late.
- Security
- Caveat on residential or commercial property
- Typical use
- Short-term needs with a clear exit
- Property-secured range
- $20,000 to $5,000,000
Caveat loans exist for a particular kind of problem: the business needs money for a short time, there’s equity in a property, and there’s a clear way to repay. When those three things line up, a caveat loan can be the right tool. When one of them is shaky, it can be an expensive one.
A good call about a caveat loan spends most of its time on the third item — the exit. Here’s how to prepare.
What is a caveat loan, in plain terms?
A caveat is a document lodged with the state land registry. Land Services Victoria describes it as a note on the title giving notice that a third party might have rights over the property. A caveat loan uses that notice to protect the lender’s interest while the loan is outstanding. It’s typically short-term, and it’s often used when there isn’t time to arrange a full mortgage, or when a first mortgage already sits on the title.
Caveat loans sit inside the broader range of property-secured business lending, which runs from $20,000 to $5,000,000 over residential or commercial property.
What will the specialist ask?
- What’s the deadline, and what happens if it’s missed? A settlement, an ATO notice, a supplier demand, a contract milestone.
- Where’s the property, and who owns it? The registered owner’s full name as it appears on title.
- What’s already registered on the title? Existing mortgages and lenders, and roughly what’s owed.
- How much equity is there? A realistic value estimate helps.
- How and when will the loan be repaid? The exit, with dates.
- Is the owner of the property also the borrower? If not, how are they involved?
What should I have ready?
| Have ready | Why |
|---|---|
| Property address and registered owner’s full name | Needed to check the title |
| Existing mortgage details and approximate balances | Shows what sits ahead of the caveat |
| A realistic value estimate | Establishes the equity |
| The document creating the deadline | Shows what the money must achieve, and by when |
| Evidence of the exit | Sale contract, refinance approval, contract payment schedule, refund notice |
| Recent business bank statements | Shows the business can hold things together in the meantime |
The call-prep tool builds this list for you, including extra items if the business is newer or there are past credit issues.
With the title, equity and exit details in front of you, request your caveat loan call-back.
Why is the exit so important?
Because a short-term loan only works if it ends. Compare two illustrative situations:
| Exit A | Exit B | |
|---|---|---|
| What repays the loan | Sale of a unit that has already exchanged, settling in 8 weeks | “We’ll refinance with a bank once trading picks up” |
| How certain is it? | High — contract signed, date set | Low — depends on future trading and a bank’s decision |
| What the specialist will ask | Can I see the contract? | What evidence is there that a bank would lend? |
Illustrative example only.
Exit A is a strong basis for a short loan. Exit B may still be possible, but the conversation will go deeper, and a longer-term structure might suit better. Our page on exit and early repayment questions goes into this.
What should I ask before taking a caveat loan?
- What’s the term, and what happens at the end of it?
- What are the total fees in dollars — establishment, legal, lodgement and removal of the caveat?
- Is interest paid monthly, or added to the loan and paid at the end?
- What would an extension cost if my exit runs a few weeks late?
- Can I repay early without penalty if the exit comes through sooner?
- Is anyone else required to guarantee the loan?
Small business loan contracts are covered by unfair contract term protections that ASIC administers, but that doesn’t replace reading the terms. If there’s a disagreement later, ASIC’s guidance on disputes about commercial loans explains the steps, starting with the lender’s own complaints process.
When might something else suit better?
If the need is longer than a few months, or the exit is uncertain, a second mortgage or a longer-term property-secured loan may be more appropriate. Our property-secured call prep covers those options. If the deadline is an ATO notice, a payment plan or a conversation with the ATO may buy time alongside any finance — see the ATO debt call prep.
How does a caveat loan usually unfold?
The steps are similar to other property-secured lending, just compressed:
- First call. Deadline, property, equity and exit.
- Title check. The lender confirms ownership and what’s already registered on the title.
- Value check. Depending on the amount and property, this may be a desktop assessment or a formal valuation.
- Documents and signing. Loan documents and the caveat are prepared and signed by everyone with an interest in the property.
- Funding. Money is paid to you or directly to whoever needs paying.
- Exit. The loan is repaid and the caveat is withdrawn from the title.
Where timing is tight, the steps that most often cause delay are getting every owner to sign, confirming what’s owed on existing mortgages, and valuations on unusual properties. Flag any of these on the first call so they can be planned for.
Ready to talk through a short-term loan?
When the deadline is real and the exit is clear, one well-prepared call can tell you quickly whether a caveat loan makes sense. There’s no credit check just to ask, your enquiry goes to one team rather than an auction of lenders, and the person who rings has read your details first.
Please be precise about the property, what’s owed on it, the deadline and your exit — accurate answers are how we match you properly on the first call. Choose your window and request the call-back.
Frequently asked questions
What is a caveat?
It's a document a person with an interest in a property can lodge with the state's land registry. Land Services Victoria describes it as putting a note on the title that gives notice a third party might have rights over the property.
How is a caveat loan different from a second mortgage?
A second mortgage is a registered mortgage behind the first. A caveat loan uses a caveat on the title to protect the lender's interest instead. Caveat loans are usually short-term and often used when time matters.
Does the property owner have to be the borrower?
Not always, but everyone with an interest in the property needs to be involved and understand what they're agreeing to. Mention on the first call if the owner is someone other than the borrowing business.
What's a good exit for a caveat loan?
Something specific with a date attached: a property sale that has exchanged, a refinance already in progress, a contract payment due, or a tax refund being processed. The more certain the exit, the easier the conversation.
What if my exit is delayed?
Ask before you sign what an extension would look like and cost. Short-term loans that run past their term can become expensive, so understand the terms up front.