Why can't I seem to find many banks in Australia that accept sellers notes

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by a searcher from University of Melbourne
in Launceston TAS, Australia

4yrs ago

Why can't I seem to find many banks in Australia that accept sellers notes

i have spoken to every bank in aus and most are reluctant to accept sellers note as equity.

they want to lend against assets.

can i continually borrow against the same property i own as equity?

why are there so few cash flow lenders that provide unsecured and sellers note?

any ideas? is it possible to find these outside australia?

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reply by a searcher 4yrs ago
in Limerick, Ireland

or go back to the seller and propose 100% seller finance, no banks, potentially higher value and the seller can keep the interest on the note, and likely mitigate their tax liability compared to if they received a lump sum up front.

reply by a searcher 4yrs ago
from The University of Michigan in New York, NY, USA

banks will always view seller notes as debt, which is exactly how it will show on your balance sheet post-close. since you're paying interest likely each month, this detracts from the cash flow available to paying down the bank debt. of course they're senior in the capital structure but it's a riskier loan to make if there's seller note vs. all equity (other than the bank debt).