NPN Finance News

Building Your Credit Score

oneclicksydney@outlook.com (Simon gee) — Thu, 09 Apr 2026 14:02:07 GMT

How to build your personal credit

Improve Your Credit Score: A Complete Guide for Sydney Borrowers

Your credit score plays a crucial role in your financial future. Whether you're applying for a home loan, personal loan, or business finance, lenders use your credit profile to assess your reliability and risk. A strong credit score can help you secure better interest rates, higher borrowing capacity, and faster approvals.

At NPN Finance, we help clients across Sydney understand, improve, and leverage their credit score to achieve their financial goals. If you're looking to strengthen your credit profile, this guide will walk you through the key steps.

�� What Is a Credit Score and Why Does It Matter?

Your credit score is a numerical representation of your creditworthiness, based on your financial history. It takes into account factors such as:

Your repayment history

The number of credit accounts you hold

Outstanding debts

Credit enquiries

Length of your credit history

In Australia, credit scores are used by banks and lenders to determine how likely you are to repay a loan. The higher your score, the more favourable your lending options will be.

�� 1. Stay on Top of Your Repayments

Your repayment history is one of the most important factors affecting your credit score. Even a single missed or late payment can have a negative impact.

To stay consistent:

Set up direct debits for bills and loan repayments

Align repayments with your payday

Use reminders or budgeting apps to stay organised

By making all payments on time, you demonstrate reliability to lenders—one of the strongest indicators of a healthy credit profile.

�� 2. Keep Track of Your Credit Commitments

Many people underestimate how much credit they have open. Credit cards, personal loans, and buy-now-pay-later services all contribute to your credit exposure.

To manage this effectively:

Review all active accounts regularly

Avoid taking on unnecessary debt

Keep credit card balances low

Lenders assess your ability to manage existing debt, so maintaining control over your commitments is essential.

�� 3. Keep Your Personal Details Up to Date

It may seem simple, but outdated information can lead to serious issues. If lenders can’t contact you, you may miss important payment reminders or notices.

Make sure you:

Update your address when you move

Notify lenders of changes to your phone or email

Keep your employment details current

Accurate information ensures smooth communication and helps protect your credit history.

⚠️ 4. Act Early if You’re Struggling Financially

If you're having difficulty meeting repayments, the worst thing you can do is ignore it. Missed payments or defaults can significantly damage your credit score.

Instead:

Contact your lender as soon as possible

Ask about hardship arrangements

Explore refinancing or restructuring options

At NPN Finance, we regularly help Sydney clients navigate these situations and find solutions before long-term damage occurs.

�� 5. Review Your Credit File Regularly

Checking your credit report is one of the most overlooked but powerful steps in improving your credit score.

Benefits of reviewing your file:

Identify errors or incorrect listings

Monitor your financial progress

Understand how lenders view your profile

There are several online services in Australia that allow you to access your credit file for free. If you find any inaccuracies, you can request corrections to ensure your report reflects your true financial position.

�� How NPN Finance Can Help

Improving your credit score is not just about fixing past issues—it’s about building a stronger financial future.

At NPN Finance, we help clients across Sydney:

Understand their credit position

Identify opportunities for improvement

Structure loan applications for better approval outcomes

Access lenders suited to their profile

Whether you're preparing for a home loan, refinancing, or business funding, we ensure your credit profile is working in your favour.

�� Final Thoughts

Improving your credit score takes time, consistency, and the right strategy. By staying on top of your repayments, managing your commitments, and regularly reviewing your credit file, you can significantly strengthen your financial position.

If you're unsure where to start or want expert guidance, NPN Finance is here to help.

�� Ready to Improve Your Borrowing Power?

Speak with our Sydney finance specialists today and take the next step towards better financial opportunities.

What is a Non Recourse Commercial Loan

Mon, 16 Sep 2019 14:56:57 GMT

What is a Non Recourse Commercial Loan?

A non recourse commercial loan is one whereby the only form of security taken in support of the loan is the underlying asset or project which the loan is funding with the lender having ‘no recourse’ or no resort to any of the borrowers’ other assets.

For example, if a borrower takes out a loan to fund purchase of a commercial property, the security under a non recourse loan arrangement would be a mortgage over the said commercial property and a GSA or charge over the company (if property is held in company name )with no guarantee taken from individuals or any other companies forming part of the same group.

This is usually sought out by company directors who wish to borrow in their company name without necessarily providing directors’ guarantees in support of the lending.

Criteria for consideration

- Commercial Loans with low loan to valuation ratios well below the standard 65-70% levels. For example if a borrower seeks a loan of $3,000,000 against a property valued at $6,000,000, the likelihood of approval on a non recourse basis are higher. This is because the lender will have a higher buffer in event of a default.

LVRs usually need to be around the 50% mark.

- Non recourse loans are usually available for larger loan amounts and require more input from credit assessors.

- Strong primary exit needed. In other words, debt servicing from income available to the borrowing entity on a stand alone basis needs to be strong with no reliance on other group companies for servicing. Where income available for servicing is scattered among different businesses/companies, guarantees from those companies will need to be taken which may take the loan outside the non recourse parameters.

- Strong applicants more likely to be granted approval on a non recourse basis.

The benefits of this type of lending is the simple security structure with the lender taking security over the commercial property on a stand along basis without holding the individuals personally responsible for the debt. It is particularly appealing to large groups of companies with multiple ownerhip structures as it keeps their security structure clear-cut.

One of the main benefits of a non recourse loan is the elimination of personal liability.

Drawbacks include the fact that non recourse lenders will impose more restrictions on their loan arrangements by way of added covenants or ongoing conditions. This is usually done to ensure the underlying property maintains its value and the LVR is not eroded.

When making your borrowing decisions, it is important to keep in mind that your lender and loan have a significant impact on the ongoing management of the loans associated with your commercial property portfolio. This can have an impact not only on your loan management but also on your overall property portfolio. This is why it is important to discuss your strategies early on with your trusted finance broker who can negotiate on your behalf with the lender a loan structure that best fits your needs.

Commercial Investment Loans

Mon, 16 Sep 2019 14:54:56 GMT

Commercial Investment Loans

Definition

Commercial Real Estate (often abbreviated to CRE) is property that is income producing used for business purposes as opposed to residential.

Some examples include shops, restaurants, office buildings and shopping centres.

Commercial property can be either owner operated ie the owners of the property operate their businesses from the said commercial property, or they can be owned by landlords who then lease them out to business owners to house their operations.

In this blog, we will be looking specifically at Commercial Investment Property being a property owned by a landlord for investment purposes, ie leased to a business operator.

Ownership

A commercial property is often owned by a business entity as opposed to a residential property which is traditionally owned by individuals.

Commercial properties can be owned by companies, partnerships, property trusts and other corporate entities.

Often these entities are formed for the special purpose of owning commercial real estate and are referred to as a special purpose vehicle (SPV) which means their structure and ownership is in isolation to other assets and business operations that the corporate group may own or engage in.

Type of lending

A commercial or business loan is provided for the funding of commercial property acquisitions for investment purposes.

Typically, these loans have maximum terms of 15 years however most lenders offer a level of flexibility whereby smaller terms may be offered initially that can be renewed on expiry. Often a business loan through renewal, interest-only terms or refinancing may have a tenure that extends beyond the 15 year term.

The term of these facilities is usually dictated by term of the lease. For example, if a company purchases a restaurant that is operated by the tenant under a lease that has a 5 year remaining term, the lender will provide a facility that cannot exceed the lease term. This is to ensure the debt servicing capacity of the property is maintained. This is especially evident when the loan is non-recourse, it the lender has recourse only to the mortgaged property as security.

Whilst a shorter term is provided, repayments continue to be calculated on a longer term usually 15 years or facility may be offered on an interest only basis for its term.

The loan to valuation ratio (LVR) is usually offered at a maximum of 70% of property value or purchase price. Some banks and lenders will provide lending at higher LVRs however this usually comes at a premium ie a slightly higher interest rate.

Serviceability Assessment

These loans are usually assessed by reference to the leasing income associated with the commercial property.

An interest ratio cover is calculated by dividing the net leasing income less outgoings (property expenses paid by landlord ie council rates, water rates and sometimes some utility bills depending on lease terms) by the interest expense.

For example a property with a net leasing income of $100,000 and an interest payment of $80,000 per annum will have an interest cover ratio of 1.25 times. In other words, rental income covers interest 1.25 times.

A preferred ratio is 2 times on current rates though that’s not always achievable. Some lenders have a ICR requirement of 1.5 times.

A negative ICR indicates negative cashflows from the property ie rental income cannot cover the interest expense.

Rates and Charges

The perceived higher risk associated with commercial property translates to higher interest rates than on residential loans. The spread is usually 1% however this depends on variables such as lease term, background and tenure of the tenant, strength of borrower group, existence of other cashflows that may be used for servicing, property location and LVR.

Other costs that apply;

- Valuation fee

- Legal fees

- Bank Application fees and monthly service fee

A commercial property investment provides means for a property investor to diversify and tap into the commercial real estate market.

Whilst more risky than the residential property market, commercial property ownership can be rewarding and this market is often counter cyclical to the residential market, ie during a residential property downturn, commercial property market may continue to strive and even experience an upward turn.

The risks and benefits of a commercial property investment needs to be carefully evaluated with advice from experts such as lawyers, accountants and mortgage broker.

If you are considering investment in commercial property, we are ready to talk to you and share our insights with you. We have a large database to tap into and are ready to sit down with you and discuss options that may suit your goals and property portfolio.