Short-Term Business Loans

Short-term business loans are facilities with terms between 6 and 24 months, designed to provide capital for a specific purpose with a defined repayment timeline. They are not permanent financing — they are structured to bridge a gap, fund a project, or provide working capital until a longer-term solution is in place.

In Australia, short-term business loans are available from banks, non-bank lenders, fintech platforms, and private lenders. The right choice depends on how much you need, how quickly you need it, what security you can offer, and what it will cost.

Property-Secured vs Unsecured

The most important distinction in short-term business lending is whether the loan is secured against property or unsecured. This single factor determines the interest rate, the loan size, the approval speed, and the documentation required.

Unsecured business loans from fintech lenders are fast — often approved within hours — but expensive. Annual percentage rates of 15% to 40% are common, loan sizes are typically capped at $500,000, and terms are short (3 to 12 months). They require minimal documentation but the cost makes them unsuitable for larger or longer-term needs.

Property-secured loans from private lenders offer significantly better rates because the lender has the property as collateral. Loan sizes range from $100,000 to $10,000,000, terms extend to 24 months (or longer on some products), and interest rates are lower because the risk is mitigated by the property security. The trade-off is that a valuation is required and settlement takes slightly longer — typically two to four weeks.

When Short-Term Business Loans Make Sense

Bridging a timing gap

The most common use case. You need capital now but your long-term funding (bank loan, property sale, investment round) will not be available for weeks or months. A short-term loan bridges the gap.

Funding a specific project

A defined project with a clear start, finish, and return — a property development, a stock purchase for a seasonal business, or equipment acquisition. The loan term matches the project timeline, and the return from the project funds the repayment.

Working capital for growth

Your business is growing faster than cash flow can support. A short-term facility provides the working capital to fulfil orders, hire staff, or expand operations while revenue catches up. The exit strategy is repayment from increased business cash flow.

Debt restructuring

Multiple short-term debts at high interest rates can be consolidated into a single property-secured facility at a lower rate, then refinanced to a bank within 12 months once the position is cleaned up.

Costs of Short-Term Business Loans

For property-secured short-term loans through Alphacon Capital, the typical cost structure includes: establishment fee from 1.65% of the loan amount, loan management fee from $250 per month (Resolve) or from 0.1% per month (Boost), and risk fee based on property type and LVR (nil on Resolve).

On a $500,000 loan over 12 months, the total cost through our Resolve product (no risk fee) would be approximately: $8,250 establishment fee plus $3,000 in monthly management fees plus valuation and legal costs. This compares favourably to unsecured fintech loans where the total cost on the same amount could exceed $75,000.

Use our bridging cost estimator to model the exact costs for your scenario, including a side-by-side comparison of products.

Private Lender vs Bank for Short-Term Loans

Banks can provide short-term business facilities, but the approval process takes 4 to 8 weeks, requires full financial documentation, and is subject to rigid credit criteria. If your deal has a timeline constraint, the bank process may not work.

Private lenders approve in 24 hours and settle in 2 to 4 weeks. The cost is higher, but the speed and certainty deliver value that goes beyond the interest rate comparison. Many borrowers use a private lender for speed, then refinance to a bank once the time pressure has passed — capturing the best of both worlds.

The Importance of an Exit Strategy

Every short-term loan needs a clear exit — a defined plan for how the loan will be repaid at the end of the term. Without a viable exit strategy, the application will not be approved by any reputable lender.

Common exit strategies include: sale of the secured property, refinance to a bank or longer-term lender, repayment from business cash flow, sale of another asset, or settlement of a receivable. The exit strategy should be realistic, documented, and ideally have a secondary fallback if the primary exit is delayed.

Some of our products include auto-extension features (Boost and Reach) that provide a buffer if the exit is delayed. This avoids the borrower being forced into default purely because of timing — a significant advantage over lenders that do not offer extension flexibility.

Which Product Fits?

For standard short-term business loans with income verification, our Resolve product offers the lowest cost with no risk fee, terms up to 60 months, and loan sizes from $100,000 to $5,000,000. For fast approval with no income documentation, Boost provides 24-hour turnarounds in metro areas with terms of 6 to 24 months.

Use our AI Loan Assessment tool to get an instant product recommendation based on your specific scenario, or submit your deal directly for same-day indicative terms.