When settling a commercial loan most lenders will require the following legal documents.
This is a guide only
Pre-settlement Legal Requirements include:-
The lender’s solicitor will normally provide the following:-
Commercial Term Loan Facility Letter of Offer plus copy
Directions to pay
Direct Debit Request Form
Loan Account Instructions Form
Bank Solicitors Fee (payable by client)
A List of APRA approved Insurers suitable for insuring the commercial property
The following documents will usually be required for completion:-
Letter of Offer duly signed or initialed
The Mortgage duly executed and stamped to secure total loan amount. The mortgage must be stamped prior to return
Executed Direction to Pay
Direct Debit Request Form completed and signed
Loan Account Instructions Form completed and signed
Bank cheque for payment of legal fees
A certificate of currency issued by the insurer or an original building insurance policy on a replacement basis noting the lender as Mortgagee. The insurance must be through one of the approved insurers.
Survey Certificate by exception only. The lender will advise specifically where a survey certificate is required, in all other instances provision of Survey Certificate is not required. Where a Survey Certificate is required it must: –
(i) Identify the land by reference to its present title particulars,
(ii) Identify any building erected on the land by street number or name
(iii) Certify that there are no encroachments by or upon the property and that the Local Government Regulations and/or Environmental Planning and Assessment Act Regulations have been complied with as to the distance of walls, eaves and gutters from boundaries. The Zoning Certificate, not more than 2 years old and to confirm current zoning as listed in the valuation report.
Land Tax Certificate (for refinance and increase requests only).
Cheque in favour of the Land & Property Information NSW for for payment of registration fees
Existing Bank loan number is to be repaid in full and closed at settlement.
Discharge of Mortgage from existing Bank will be required at settlement.
Copy of lease number
Copy of variation of lease number
Other Special Conditions and Requirements
Copy of any other lease/s in place for the properties.
All of the above documents and requirements need to be met at least 3 business days prior to the commercial property settlement. Cheque direction is to be received by the lenders solicitor no later than 10am on the morning before settlement.
What are some of the other Commercial Loans legal fees and charges that may be incurred?
Settlement costs may be higher if settlement is taking place outside of capital cities.
Preparing mortgage, guarantee, indemnity and company charge (as required) including –
o Review and advise on trust deeds(if applicable)
o Certify compliance
o Arrange and attend settlement
o Stamp and register documents
Matters which do not proceed
Preparing discharge of mortgage, arrange and attending settlement
Preparing consent to new lease, transfer, assignment, surrender and sublease, producing title and registration
Preparing deed/ letter of priority and execution by required parties
Consent to registration of bankruptcy application/notice of death
Increase/Variation of loan amount or loan terms or security
Consent to registration of subdivision, consolidation, strata plan, producing title and registration
Title searches, photocopying, facsimile, company searches
Registration fees (Land Titles and ASIC)
Bank cheque fees
Old System title search
Interstate agent’s settlement fee
You will also need to allow for government charges and duties which may include stamp duty on the mortgage, stamp duty on the transfer of land and registration fees.
You will also need to allow for your own legal fees.
The above is a guide and guide only as to the legal fees you may be charged when settling a commercial loan.