Can You Get a Caveat Loan for a Property Purchase?

Why traditional lenders decline this request

Caveat loans are short-term, bridge-style financing that usually last 6-24 months. Banks don't offer them because they require specialized assessment (title work is essential, and speed matters). Banks are designed for long-term mortgages, not bridge financing. They decline caveat requests without explanation or offer only conventional mortgages, which don't meet the buyer's timeline.

For property buyers facing tight timelines—completing a sale, needing funds before a settlement date—banks simply can't help. The buyer is forced to either delay their purchase or overpay for alternative funding. This is frustrating because the deal is real, the property is solid, and the need is temporary. Banks just can't move fast enough.

How specialist lenders approach this differently

• Speed-focused — Settlement within 24 hours, not weeks.
• Bridge expertise — They understand short-term financing and exit strategies.
• Flexible terms — They can accommodate unusual purchase situations.

What a typical deal looks like

Imagine a buyer who's found the right residential property ($750,000 purchase). Their current home is on the market but hasn't sold yet. The seller wants to settle immediately. The buyer needs a caveat loan for $550,000 to bridge the gap until their current home sells (expected in 4-6 weeks). Their bank won't offer a bridge loan—that's not their product line. A specialist lender reviewed the purchase property ($750,000, 73% LVR), the buyer's current home (in contract to sell), and confirmed the bridge timeline is realistic. They approved $550,000 caveat loan at 9.99%, 12-month term. Settlement in 24 hours. Within six weeks, the buyer's original home sold, and they repaid the caveat loan early without penalty.

What lenders want to see

• Purchase contract — Signed contract with the seller, showing purchase price and settlement date.
• Property valuation — Comparable sales or valuation confirming the purchase price.
• Title information — Title details (from title search or conveyancer) showing no complications.
• Exit strategy — How you'll repay—sale of another property, refinance, personal funds, etc.

When this might not work

Caveat loans may not work if: (1) the property valuation is lower than purchase price, (2) the exit strategy is unclear, or (3) there are title issues.

• Overvalued purchase — buying significantly above market value.
• Unclear exit — no clear plan for loan repayment.
• Title issues — caveat on title, flooding, easement complications.

How to get started

• Step 1: Describe your situation. Tell us what you need and any challenges.
• Step 2: Get matched with lenders. Our AI finds the right fit from specialists on our platform.
• Step 3: Review and move forward. Choose your option and connect directly with lenders.