Property-secured finance for wholesalers, distributors and importers

A wholesaler’s cash goes on a long trip before it comes home. It leaves as a deposit to an overseas factory, then as the balance before shipping, then as freight, duty and GST at the border, then as warehouse rent and wages while the stock waits to be picked. It only returns weeks after a customer takes delivery, because the big retailers and trade customers want 30, 45 or 60-day terms.

Growing that business means stretching the trip further. A bigger order, a new product line or a new national customer all need more cash out the door before any comes back. Directors who own property can use that equity to fund the gap without handing their stock or debtors to a financier.

Where does the cash go in a wholesale cycle?

Stage	What you pay	When the cash returns
Purchase order	Factory deposit	Not until the goods sell
Pre-shipment	Factory balance	Not until the goods sell
Arrival	Freight, port charges, customs duty, import GST	GST comes back as a BAS credit; the rest when goods sell
Warehouse	Rent, labour, insurance	Spread across sales
Sale	Nothing, but the customer takes 30 to 60 days	When the invoice is paid

The Australian Border Force says GST on imported goods is paid at clearance unless the importer is approved to defer it, and that customs duty must be paid before the goods are released from customs control. GST is calculated on the value of the taxable importation, which adds the customs value, duty, and transport and insurance to Australia, so it’s bigger than many first-time importers expect.

For a single container, our page on funding import shipments and customs duty goes into the border mechanics. This page looks at the business as a whole.

Should you join the deferred GST scheme first?

If you import regularly, probably. The ATO’s deferred GST scheme lets eligible importers defer GST on taxable imports and pay it through their monthly BAS instead of at the border. To qualify you need an ABN, GST registration and monthly BAS reporting, lodged online with electronic payment, and the ATO says you may not be eligible if your returns, BAS and payments aren’t up to date.

That last condition is where a secured loan sometimes helps twice. Clearing an overdue ATO balance can put an importer back in a position to apply, which removes import GST from the border cash call for future shipments. See paying ATO debt with property equity. Duty remains payable at the border either way.

How it works for a wholesaler

1. Enquire. The property address, what’s owing on it, how much you need and for what. No credit check at this stage.
2. Specialist review. We look at the security and, just as closely, at your stock turn: how long from landing to cash.
3. Structure. A caveat loan for a single shipment; a second mortgage for a seasonal build or a longer programme; a first mortgage over a debt-free property or a warehouse purchase.
4. Letter of Offer with the term, pricing, fees and conditions in writing.
5. Settlement, with funds paid to you, your supplier or your customs broker.

Our caveat loans page explains the quickest structure, and how it can later convert to a registered second mortgage if the need runs longer.

Who it suits

• Importers and distributors with property equity and confirmed orders or a proven sell-through history.
• Businesses winning a large customer whose payment terms are longer than their own supplier terms. See funding a big contract with property security.
• Wholesalers buying their own warehouse. Our industrial property loans page and buying commercial property fast cover the purchase.
• Owners who’d rather keep stock and receivables unencumbered for their bank and suppliers.

When this isn’t the right move

• Slow or dead stock. If last season’s range hasn’t moved, borrowing to buy more compounds the problem. Clear it first.
• Margins can’t carry the cost. On thin-margin commodity lines, the cost of funds can eat the profit. Do the sums per container.
• A permanent working capital need. A business that always runs this gap needs a standing facility. A short secured loan is a bridge back to one, not a substitute forever.
• No property to offer. This is property-secured lending only.

How does it compare with other wholesale funding?

Option	Security	Fit
Property-secured private loan	Home, investment property or warehouse	Fast, flexible bridge; stock and debtors stay free
Bank trade finance	Usually property plus a general security agreement	Lower cost once approved; slower to set up or increase
Invoice finance	Your receivables	Works when customers are creditworthy; costs rise with slow payers
Supplier credit	The supplier’s trust, often retention of title	Cheapest if offered; limited by the supplier’s appetite
Inventory or stock finance	The stock itself	Lenders discount stock heavily; specialised lines may not qualify

For a bridge that ends with a known event, the caveat loan vs bridging loan comparison is a useful read.

What does the PPSR mean for a wholesaler?

Two things. First, your overseas or local suppliers may hold registered security interests over the stock they ship you on credit. Second, you may want to register your own interests over goods you supply to customers on terms. The PPSR’s guidance for wholesalers says registration puts a supplier in the best position to enforce its interest, and that unregistered goods may end up paying other secured creditors if a customer becomes insolvent. It also notes financiers can see registrations. Because property-secured lending doesn’t touch the stock register at all, it sits comfortably alongside those arrangements.

How do you size the loan to your stock turn?

The right loan amount comes from a timeline, not a guess. Sketch it out week by week:

• Week 0: factory deposit leaves.
• Week 6 to 10: balance due before the goods ship.
• Arrival: duty and, unless you defer it, import GST at the border, plus freight and port charges.
• First sales: usually two to four weeks after the goods reach your warehouse.
• First cash: your customers’ terms on top of that, plus a buffer for the ones who pay late.

The deepest point on that line, where the most cash is out and the least has come back, is the amount to borrow. The date the line climbs back above zero, with a margin, is the term.

GST timing matters here. Monthly BAS is due on the 21st of the following month, so import GST paid at the border in March typically comes back as a credit on the March statement lodged by 21 April. On a quarterly cycle the wait is longer. Build that refund into the exit, not the loan amount.

What it costs (without the guesswork)

Pricing turns on the security, LVR, term and exit of each deal, and we aim for the sharpest outcome your circumstances allow. The items on the Letter of Offer are interest (which can be prepaid or capitalised), a small assessment fee that varies per loan, and legal and registration costs. A second mortgage or caveat generally costs more than a first mortgage. The biggest lever you control is the term: match it to your real stock turn.

Documents you’ll need

• ID for borrowers, directors and guarantors, and company or trust details;
• title details for the property and statements for existing loans secured on it;
• supplier invoices, purchase orders and shipping documents for the stock being funded;
• customer orders, contracts or a sales history that shows sell-through;
• recent BAS and an ATO statement, especially if you plan to apply for deferred GST.

How fast can it happen?

Funding is possible within 24–48 hours for up to $5m once documents are in, and $20k to $250k against property is possible the same day. There is no formal valuation required, so nothing waits on an inspection. Most delays come from a co-owner who hasn’t signed or a missing loan statement, so line those up before the container arrives.

What could the numbers look like?

Illustrative example: a Brisbane homewares distributor needs $300k for a Christmas range: a $180k factory balance, about $70k of freight, duty and import GST, and $50k of extra warehouse labour. The director owns an investment property worth about $900k with $350k owing. Net funds:

• $900k × an illustrative 70% LVR band = $630k total headroom.
• Less the existing $350k loan = $280k available behind the bank, so the director adds a second property to close the gap.
• With both properties, a $320k second mortgage is written for 6 months with interest prepaid.
• Less prepaid interest, the assessment fee and legal costs, roughly $300k is in hand. The range sells through October to December, the major customer pays in late January, and the GST comes back on the monthly BAS. The loan is repaid in February.

Distributors around the Brisbane trade coast can read our Brisbane private lender page. If you also make product, see manufacturing and industrial.

See if you qualify

Begin your enquiry with the property, what’s owing on it, the amount and the shipment or season you’re funding.

Enquiring doesn’t put a mark on your credit file, your details go to one direct lender instead of a broadcast list, and a real specialist reads the numbers. Give accurate figures for the property and its existing debt and you’ll get a dependable answer the first time. See what your property could fund.