Loans
Residual stock loan
A residual stock loan is finance secured against the completed, unsold stock in a development - the remaining units, lots or apartments after a project finishes. It lets a developer release the equity tied up in finished stock, or repay a construction facility that's falling due, without discounting the last stock to hit a deadline. Because the security is completed, marketable real property, it's assessed on the value of that stock and a clear sell-down exit.
How a residual stock loan works
When a development finishes, capital stays locked in the units or lots that haven’t sold yet. Meanwhile the construction facility that funded the build is usually falling due. A residual stock loan is finance secured against that completed, unsold stock - it releases the equity held in the finished units, or repays the build debt, so you’re not forced to discount the last stock to meet a deadline. Because the project is complete, the security is standard, marketable real property rather than a construction risk, and the facility is sized on the value of the stock and how readily it will sell. As each unit or lot settles, the loan reduces.
What it’s typically used for
Two jobs, usually. The first is clearing a construction or development facility that has reached its maturity date while the final stock sells at proper value rather than a fire-sale price. The second is releasing equity from completed stock to fund the deposit or early costs on the next project, so capital isn’t stranded in finished units waiting for the market. In both cases the developer holds a finished, marketable asset and simply needs the equity in it working rather than sitting idle.
What we’ll need
The completed stock - what it is, how many units or lots remain, and their value - plus any facility being repaid and the sell-down plan. Because the build is done, the assessment turns on the stock’s value and marketability and a credible sales program, not construction risk or trading history. Send us those and we’ll confirm whether a residual stock loan fits, or whether take-out funding is the cleaner structure, and come back with indicative terms quickly. You deal with us start to finish.
- Developers holding completed, unsold stock at the tail of a project
- Borrowers whose construction facility is maturing while the last units or lots sell
- Companies or trusts wanting to release equity from finished stock to fund the next project
- Projects still under construction - that's development or construction finance
- Stock with no realistic sell-down or refinance exit
- Owner-occupier consumer borrowers (business-purpose only)
How it compares
FAQ
What is a residual stock loan?
Finance secured against the completed, unsold stock left at the end of a development - the remaining units, lots or apartments. It releases the equity held in that stock, or repays a construction facility, and is repaid as the stock sells down.
How is it different from take-out funding?
They're close cousins. Take-out funding clears the whole construction or development facility on completion; a residual stock loan is specifically secured against, and sized on, the unsold stock - often used to release equity from that stock rather than simply refinance the build debt.
How is it repaid?
Usually from the stock settling as each unit or lot sells, with the facility reducing as sales complete. A refinance is also a valid exit. The sell-down plan is central to the assessment.
What can I borrow against?
The completed, unsold stock your company or trust owns - finished residential or commercial stock in a completed project. We arrange funding against the value of that stock, subject to assessment.
Is a residual stock loan business-purpose only?
Yes. It's for Australian companies and trusts, for business or investment purposes - not consumer credit.
Release the equity in your finished stock.
The amount, the asset and the timeframe. We’ll review and come back to you fast.
1300 421 044You deal with us start to finish.
Enquire
Send an enquiry
Takes two minutes.