The Smart System · the companion tool
How does this loan actually get repaid?
Many short-term, private and bullet-principal facilities are repaid by an event, on a date — a sale, a refinance or a settlement. That is the exit. Ordinary secured term loans can amortise from trading cash flow, but when the principal is due in one lump, the exit is part of the credit decision from day one.
This works out whether yours has enough room in it, and whether what you are calling a backup really is one.
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Objective information or arithmetic based on what you enter.
Publicly available information about how commercial lending products and structures commonly work.
Our educational CAS interpretation. It helps you ask better questions; it is not a lender decision or product recommendation.
The facility
Roughly is fine. This is about the shape of the plan, not the cents.
The date the whole thing has to be repaid. It is in your term sheet.
The exit
The event that repays it.
Use net refinance proceeds or a realistic sale/settlement amount — not the headline property value.
Prior mortgages, agent/legal/selling costs, taxes or other amounts that rank ahead of this facility.
Best source is a lender payout or term-sheet figure. If blank, the tool uses the facility amount as a conservative floor.
Used only to illustrate the cost of a 30/60/90-day delay. Default interest, extension fees and compounding are not assumed.
Lenders price the evidence, not the intention.
The backup
What happens if the first plan is late. This is the question most people have not answered, and it is the one a credit team asks first.
Capitalisation is common in some short-term/private structures, but not universal. Ask whether accrued interest itself accrues interest, what rate applies after maturity and what extension/default fees apply.
Expert exit lens
Sale exits are about net proceeds, not valuation
A valuation does not repay a loan. The useful number is what is left after senior debt, selling/legal costs and anything else that ranks ahead of this facility — with enough calendar for settlement slippage.
The planner can stress-test the dates and dollars; it cannot decide whether a facility is right for you. If you want to explore the transaction, Smart Advance can introduce you to the broker archetype relevant to the exit — for example property/private, development or refinance — with the groundwork already organised.
Why an exit can become the centre of the credit decision
A short-term or private lender may be relying on a sale, refinance or settlement to clear the principal. That can make strong exit evidence compensate for some things a conventional lender dislikes — but it does not make capacity, valuation, legal security or the net proceeds irrelevant.
The reverse is also true. If the exit is vague, too tight or financially short, a lender may reduce leverage, require more evidence, price for the extra risk or decline. If a capitalised facility runs late, interest continues to be added and default/extension terms may apply; whether accrued interest compounds is contract-specific. That is why the due-date payout and the downside exit deserve to be modelled before signing.
More on property-secured finance, gross against net LVR, and what to ask →