The carwash, and the 12 month deadline

The situation

The clients' broker sent them to us. They were buying a carwash alongside the business they already ran, and the path of least resistance was an expensive second mortgage repayable within 12 months. Short, dear money for a long-term asset is how good operators end up in bad positions.

What we did

Our worksheet built the combined servicing case: the existing operation's true owner earnings, the carwash's adjusted profit, a full wage allowance for the buyers, and the whole structure tested at stressed rates. It passed every covenant with roughly $140,000 of surplus. The difference was the figures.

The outcome

Their broker lodged the rebuilt file, and a major bank approved a facility just under $1m at a sharp rate over 15 years, not 12 months. The clients stayed with their broker, which is exactly how our broker work is built to run.

Details anonymised and figures materially altered. Outcomes depend on individual circumstances and lender criteria.