How does the Austrata Hybrid Loan® work?

Austrata Hybrid Loan

The Austrata Hybrid Loan® is the first of its kind providing flexible lending solutions that balance the needs of different owners.

  1. At Austrata, we fund the projects works, meaning there are no funding delays, and the project can start as soon as you’re ready.
  2. At the end of the project, when every owner’s share of the actual cost is known, every owner has the opportunity to refinance their share of the Austrata loan by making a loan to the strata scheme.
  3. The total loan amount doesn’t change, for example instead of there being a loan from Austrata for $1 million, there might be a loan from Austrata for say $600k and a loan from one or more Self-Funding Owners for $400k.
  4. To pay back the total loan amount of $1 million, all lot owners are charged loan repayment levies, as is stipulated by strata legislation.
  5. The secret sauce of the hybrid loan is that the loan repayment levies that are charged to Self-Funding Owners are perfectly offset by the loan repayment credits the Self-Funding Owners receive.
  6. After the Self-Funding Owner pays their loan amount to the strata scheme, they have no more to pay.

Austrata Hybrid Loan® – How it works

Prepared by
Phil Bottomley
Austrata Finance

Author: Phil Bottomley