In Australia, home and business loans come from two broad groups. Banks, credit unions and building societies hold a deposit-taking licence and are supervised by APRA. Non-bank lenders raise their funding in wholesale markets instead, then lend it on. Both groups must hold a credit licence and belong to a free external dispute resolution scheme.
Where a non-bank lender can fit
Non-bank lenders set their own credit policies, so they often consider applications an automated bank assessment would set aside. Common examples:
- self-employed income spread across several entities, or a shorter trading history
- past credit issues that have since been resolved
- security a bank treats narrowly, such as rural lifestyle blocks, small units, or mixed residential and commercial use
- tight settlement timelines, or bridging between a purchase and a sale
- company and trust structures that need a closer read than a scorecard allows
What to weigh up
Flexibility is priced differently, and the trade-offs go beyond cost. Worth thinking about: how long the loan is likely to be held, what the exit terms say, whether the features actually used are available, and how later variations are handled. Lender appetite shifts over time too, so a comparison made a year ago may no longer reflect what is on offer. Looking across both groups together makes it clearer which parts of an application each lender pays most attention to.
Video transcript
Hi, I'm Jack Si from Australian Finance Service Solutions.
Banks aren't the only lenders in the market, and for some situations they're not even the best fit. Non-bank lenders can be faster and more flexible on things like self-employed income or unusual security, though that flexibility usually comes at a different price point.
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This is general information only and is not credit advice.
Want us to look at your situation? Send us a message or call 1300 968 888.
General information only, not credit advice. It doesn't take your personal circumstances into account.
Jack (Muyuan) Si is a Credit Representative (516785) of Buyers Choice Licencing Pty Ltd ACN 626 172 281 (Australian Credit Licence No. 509484).