When the exit slips: your options before the term runs out

Exits slip. Buyers’ finance falls over, banks ask for one more document, a slow quarter eats the buffer. None of that is unusual, and none of it has to become a crisis. What turns a slipped exit into a crisis is silence until the last week.

What are your options when the exit slips?

Option	When it fits	What it needs	Typical trade-off
Extension with the current lender	Good conduct, strong security, credible new date	Early request, evidence for the revised exit	Extension fees, possibly revised terms
Refinance to another lender	File has improved since the original loan	Full application, valuation	Setup costs, but possibly better terms
Partial repayment plus extension	Some funds available from trading or a smaller sale	Evidence of the funds	Less to extend, more options
Sale of another asset	An asset can be sold within a realistic time	Listing, appraisal	Loss of the asset
Switch exit type	E.g. sale stalled but refinance is now possible	New evidence	Time to prepare

What should you do the moment you see it slipping?

1. Pin down the cause. Buyer finance, valuation, lodgements, a lost contract? Be specific.
2. Estimate a revised date with evidence: a new settlement date, the bank’s checklist, a revised forecast.
3. Call your lender. Explain the cause, the revised date and the evidence. Ask what they need.
4. Price the alternatives. Compare an extension with a refinance elsewhere in total dollar terms.
5. Decide early. Every week of delay narrows the options.

business.gov.au’s guidance on managing debt is to speak to creditors early, explain your circumstances and keep a record of the conversation. The same applies to your lender.

Is your exit looking shaky? Talk to a specialist now, well before the term ends.

How do you ask for an extension well?

A good extension request includes:

• what has caused the delay, in two or three factual sentences;
• the revised exit date and the evidence for it;
• confirmation that the security is unchanged, or an updated appraisal;
• your repayment conduct to date;
• any partial repayment you can offer.

A request like this, made early, gives a lender a reason to agree. A request made in the last week, without evidence, gives them a reason to worry.

What if the original exit is no longer possible?

Change exits. A property that won’t sell at a sensible price might be kept and the loan refinanced instead, once the file supports it. A bank refinance that’s further off than expected might be replaced by a refinance to another specialist at better terms than the original. Our pages on the refinance exit and the asset sale exit show the evidence each needs.

What if there’s a dispute with the lender?

Try to resolve it directly first. ASIC notes that lenders that provide only commercial loans aren’t required to hold a credit licence or belong to AFCA, so check whether your lender is an AFCA member before assuming that route is available. Independent legal advice is sensible if enforcement is threatened.

How do you stop it happening next time?

• Set terms with a realistic buffer from the start; see building an exit plan.
• Use the exit plan builder to set dated milestones and review them monthly.
• Start refinance conversations months before term end.
• Keep a plan B written down from day one.

An illustrative example

With invented details: a business took a caveat loan to clear tax debt, planning to repay it from the sale of an investment unit. The first buyer’s finance fell through two months before the term ended. The owner called the lender that week, explained what had happened, provided the agent’s updated campaign plan and a new appraisal, and offered a partial repayment from a large customer payment due the following month. The lender agreed to a short extension on the reduced balance. The unit sold to a second buyer and the loan was repaid. The difference between that outcome and a default was a phone call made two months early instead of two days late.

What does an extension usually cost?

Every lender is different, and every loan is priced on its own circumstances, so there’s no standard figure. Expect an extension fee, continued interest for the extra period and possibly legal or valuation costs. Ask for the total in dollars and compare it with the cost of refinancing elsewhere, including the new lender’s setup fees and valuation. Sometimes the extension is cheaper because there’s no new paperwork; sometimes a better-priced refinance saves more over the extra months.

What should you avoid when the exit slips?

• Taking an expensive short-term loan from another provider to repay the first without a plan.
• Missing repayments while you sort it out. Keep paying what you can.
• Hoping the lender won’t notice the term ending. They will.
• Making promises you can’t evidence. A revised date needs proof, or it costs credibility.

Need a plan B before you need it?

If your exit is wobbling, now is the time to act, not the final week. Enquiring doesn’t involve a credit check, your file isn’t sent to a long list of lenders, and a specialist calls to work through extension, refinance and sale options with you. Please be accurate on the form about your current loan, its term end date and what’s delaying the exit, so we can move quickly on the right option. See if you qualify.