Why Commercial Borrowers Are Struggling to Refinance in 2026

Australia’s commercial lending market is entering a very different environment to the one borrowers experienced just a few years ago.

Many commercial property loans and business facilities originally written during the low interest rate cycle are now approaching refinance — but borrowers are discovering that refinancing today is significantly more difficult than it was when those loans were first established.

Higher interest rates, tighter bank servicing requirements, changing valuation expectations, and reduced credit appetite are creating increasing pressure across the commercial property and business lending market.

At Assurity Capital, we are seeing growing demand from borrowers requiring flexible finance solutions as traditional refinancing pathways become more challenging.

The Lending Environment Has Changed - Refinance

Over the past several years, many commercial borrowers benefited from:

• historically low interest rates

• strong property valuations

• aggressive bank competition

• easier servicing assessments

• higher leverage levels

That environment has now shifted considerably.

Today, borrowers are facing:

• materially higher interest costs

• stricter servicing assessments

• lower LVR expectations

• slower approval processes

• increased scrutiny from lenders

As a result, many borrowers approaching refinance are finding that existing facilities may no longer fit within current bank policy.

Refinancing Pressure Is Building Across Commercial Property

A large volume of commercial loans written during the low-rate cycle are now reaching maturity.

For some borrowers, refinancing is becoming difficult due to:

• increased interest servicing costs

• softening valuations in some sectors

• reduced cash flow

• tighter bank credit appetite

• changes in lender policy

Even experienced investors and business owners with strong asset positions are encountering challenges that simply did not exist several years ago.

Commercial Property Sectors Facing Increased Pressure

Certain sectors are experiencing more refinancing pressure than others, including:

• office assets

• construction and development projects

• residual stock facilities

• specialised commercial assets

• business-purpose property lending

Many lenders are reassessing exposure to these sectors, often resulting in:

• lower leverage

• additional conditions

• extended approval timelines

• reduced flexibility

Why Refinancing Gaps Are Emerging

In some cases, borrowers are discovering that the amount offered by a new lender is lower than the existing debt facility.

This can create:

• refinance shortfalls

• urgent funding requirements

• settlement pressure

• liquidity constraints

Where traditional lenders are unable or unwilling to provide flexible solutions, borrowers are increasingly exploring alternative funding structures.

The Growing Role of Private Lending

As bank credit conditions tighten, private lending is becoming a more important part of the commercial finance market.

Private lenders are often able to provide:

• fast credit decisions

• short-term refinance solutions

• asset-backed lending

• bridging finance

• pragmatic transaction assessment

Rather than relying solely on standardised credit models, private lending can offer more flexibility around:

• complex transactions

• time-sensitive settlements

• transitional situations

• refinance requirements

Speed and Certainty Matter in Volatile Markets

In the current environment, delays can become expensive.

Borrowers managing:

• upcoming maturities

• refinancing deadlines

• covenant pressure

• commercial settlements

• project timing

often require certainty and speed of execution as much as pricing itself.

This is particularly relevant for sophisticated borrowers who understand that preserving opportunity and protecting assets may require flexible funding solutions.

Market Stress Often Creates Opportunity

While refinancing conditions are becoming more challenging, periods of market stress also create opportunities for well-positioned borrowers.

We are seeing increased activity involving:

• opportunistic acquisitions

• discounted commercial assets

• short-term repositioning strategies

• refinance restructures

• strategic bridging solutions

Access to fast and pragmatic capital can provide a significant advantage during uncertain market conditions.

How Assurity Capital Can Help

Assurity Capital specialises in private lending solutions for commercial and non-NCCP transactions.

We assist borrowers requiring:

• commercial refinance solutions

• short-term funding

• bridging finance

• asset-backed lending

• time-sensitive settlements

• flexible transaction structuring

Our focus is on:

• speed

• certainty

• flexibility

• practical commercial outcomes

Loans from $50,000.

Final Thoughts

The commercial refinancing landscape in 2026 is becoming increasingly complex.

As higher interest rates and tighter bank credit policies continue reshaping the lending market, many borrowers are reassessing how they structure and secure finance.

For commercial borrowers facing refinance pressure, access to flexible capital solutions may become increasingly important in navigating the changing market environment.

Speak With Assurity Capital

Assurity Capital📞 02 9389 1077📧 scenario@assuritycapital.com.au🌐 www.assuritycapital.com.au

Contact

Need fast, flexible funding for a commercial or non-NCCP transaction? Contact Assurity Capital today to discuss your scenario with our experienced team.