Commercial finance for New Zealand businesses

Commercial finance is the money a business uses to do business: to take on a contract, buy stock, fit out premises, settle a supplier or cover a gap while bigger money is on its way. For many New Zealand companies the hard part isn't finding a reason to borrow. It's finding a lender who will look past a checklist and understand the deal. fundU is a direct private lender offering commercial loans from $20,000 to $1m, secured on New Zealand property and assessed by our own credit team.

Because we make our own decisions, you deal with the people who actually say yes or no. There's no panel of lenders, no hand-off to a broker and no waiting on a committee you'll never meet. We look at the property, what the money is for, how it will be repaid and the full story behind your business.

What is commercial finance?

Commercial finance is lending made to a business for a business purpose, rather than a personal loan or a home loan. It's a wide family that includes bank term loans, overdrafts, asset finance, invoice finance and private property-secured commercial loans.

The phrase gets used loosely. Some people mean a loan to buy a commercial building, which we cover on our commercial property loans page. Others mean the funding a company needs to trade, grow or get through a rough patch. This page is about the second meaning: commercial loans where the security is real estate but the money goes into the business.

A commercial loan from fundU is:

• For business purposes only, available to sole traders, companies, partnerships and trusts
• Between $20,000 and $1m
• Secured by a first or second mortgage over New Zealand property
• Short to medium term, with a clear plan for how it gets repaid

What can a commercial loan be used for?

Almost any genuine business purpose, as long as the numbers and the exit make sense. We don't ask you to squeeze your situation into a narrow product box.

Common reasons Kiwi businesses come to us for commercial finance:

• Winning or delivering a contract — materials, labour and subcontractors before the first progress payment arrives
• Stock and seasonal build-up — buying ahead of a peak or taking a bulk discount from a supplier
• Fit-outs and premises — a new shop, a second cafe, a bigger workshop or a relocation
• Buying out a partner or shareholder — keeping control without selling the business
• Clearing expensive debt — replacing short-term debt that's draining cash flow, as covered on our business debt consolidation page
• Tax arrears — paying out Inland Revenue so penalties and interest stop building
• Acquisitions — buying a competitor, a customer book or a complementary business

Consumer spending, such as a family holiday or a private car, isn't something we fund. If the money serves the business, we'll take a proper look.

How does private commercial finance compare with a bank?

A bank is usually the right home for long-term debt when your financials are strong and you have time to wait. A private lender like fundU earns its place when speed, flexibility or an unusual story matters more than the lowest possible price.

The Reserve Bank's May 2026 Financial Stability Report notes that smaller firms rely on both bank and non-bank lending and more often face tougher terms when they borrow. That lines up with what owners tell us every week.

	Typical bank commercial loan	fundU commercial loan
Who decides	Credit team, often with head-office sign-off	Our own credit team, directly
Paperwork for a first look	Financial statements, tax returns, forecasts	No financials or tax returns for the initial assessment
Credit history	Defaults or arrears often mean a decline	Considered case by case
Speed	Several weeks is common	As little as 24 hours once approved, in some cases
Security	First mortgage plus a general security agreement	First or second mortgage over property
Term	Long term	Short to medium term
Repayment style	Usually principal and interest	Interest-only, capitalised interest or principal and interest

The trade-off is the term. Our commercial loans are built to carry you through a specific period or opportunity and then be repaid, often by refinancing to a bank once the business is in better shape, selling an asset or collecting on a contract.

What property can secure a commercial loan?

Most New Zealand real estate with enough equity can be used as security, and it doesn't have to be commercial property at all.

Security we regularly consider:

• Your home or another residential property
• A rental or investment property
• Commercial premises such as shops, offices and units in a business park
• Industrial property, including factories, warehouses and yards
• Some land and lifestyle blocks, case by case

The property can be owned by you personally, your company, your family trust, or a supporting party such as a parent who agrees to act as guarantor. If you have a bank mortgage you want to keep, we can often lend on a second mortgage behind it. If the property is clear, or you'd rather move everything to one lender, we can lend on a first mortgage.

A commercial loan doesn't need to be secured on commercial property. Plenty of owners use equity in their home or a rental to fund the business, which is often quicker than asking a bank to lend against trading figures.

How much can I borrow with a commercial loan?

We lend between $20,000 and $1m. Where you land in that range depends mainly on the value of the property, what's already owed against it and how confident we are in the exit.

To start the conversation, a recent valuation, the council rating valuation or an agent's appraisal is enough to give us a rough value. If the deal moves ahead, a registered valuer confirms the figure. We then look at the equity left after any existing mortgage and settle on a sensible loan that leaves a buffer.

Purpose matters as well. A $250,000 loan to fund a signed contract with a reliable principal is a very different proposition from $250,000 to cover ongoing losses with no end in sight. Give us the full picture and we'll tell you honestly what's workable. Our guide on how much you can borrow against your property goes into more detail.

How are commercial loans repaid?

Repayments are structured around the purpose of the loan, and the structure is agreed when your loan is approved.

Options can include:

• Interest-only — you pay interest during the term and repay the principal at the end
• Capitalised interest — no scheduled monthly repayments during the term; interest is added to the loan and settled when it's repaid
• Principal and interest — regular repayments that reduce the balance over the term

Capitalised interest is a real help when every dollar of cash flow is needed for the project the loan is funding. Interest-only often suits owners with steady trading income who are waiting on a lump sum. Either way, the key question is the exit: how will the loan be paid out at the end of the term? Common answers are a property sale, a refinance to a bank, a contract payment or the business's own cash flow. Our guide to exit strategies for short-term business loans explains what a strong exit looks like.

How does the commercial finance process work?

It's straightforward, and you'll be talking to a real person early on.

1. Start your enquiry. It takes a couple of minutes online and doesn't affect your credit score.
2. Talk to a lending specialist. We call you back to understand the business, the purpose, the property and the exit.
3. Initial assessment. Our credit team looks at the deal. No financial statements or tax returns are needed at this stage.
4. Supporting information. We ask only for what's relevant, such as bank statements or contracts, and arrange a valuation if needed.
5. Approval and documents. Once approved, your lawyer works through the mortgage documents with ours.
6. Funding. Funds are released, in as little as 24 hours after approval in some cases.

You can read more about how our process works.

Example scenario

A Waikato engineering firm won a supply contract with a large food processor worth around $900,000 over eight months. To deliver it, the firm needed $300,000 up front for steel, a second shift and tooling. Its bank wanted updated accounts and several weeks to decide, and the first order was due in a fortnight.

The director owned a rental in Hamilton valued at about $780,000 with a modest bank mortgage. fundU lent $300,000 on a second mortgage behind the bank, with capitalised interest so the firm's cash went straight into production. The loan was repaid from the contract's staged payments before the term ended.

What you'll need

You don't need a stack of paperwork to get started. For the first conversation, have these handy:

• Your business name and NZBN or company details
• What the money is for and how much you need
• The address of the property offered as security and who owns it
• A rough value for the property and what's owed on it
• How and when the loan will be repaid
• Anything we should know up front, such as IRD arrears, defaults or a recent bank decline

Later we may ask for bank statements, contracts, invoices or a letter from your accountant to back up the story. MBIE's figures show 97.2% of New Zealand enterprises are small businesses with fewer than 20 employees, so we're very used to owners who run lean and don't have a finance department.

Ready to talk about commercial finance?

If your business needs commercial finance and you have property to offer as security, the next step is quick. Tell us what you're trying to achieve and a lending specialist will call you back to talk it through. You'll get a straight answer on whether we can help and what a commercial loan could look like.

It's free, takes a couple of minutes and won't affect your credit score. Call us on 09 875 4577 or see if you qualify now.