When Banks Say No: Your Complete Guide to Alternative Lending Solutions in New Zealand

Traditional banks serve millions of Kiwis well. But they're built for standard scenarios—employees with steady pay cheques, straightforward property purchases, and businesses that fit neatly into lending criteria boxes.

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What happens when your situation is solid but doesn't fit the mould?

You're a property developer with a brilliant project that falls outside bank servicing criteria. You're between jobs but have a signed contract starting next month. You've won a major contract but need working capital until payment arrives. Your property needs retrospective consents before banks will touch it.

These aren't risky scenarios—they're just different. And different doesn't work in standardised lending systems.

That's where alternative lending comes in. Not as a last resort, but as a strategic solution for complex, time-sensitive, or non-standard situations that deserve funding on their merits.

This guide walks you through 11 lending scenarios where Luminate Financial Group steps in when traditional banks can't help.

Understanding the Gap Between Banks and Real-World Needs

Banks operate under strict regulatory frameworks. They need:

• Continuous employment history
• Standard property types with clear valuations
• Lengthy approval processes (3-6 weeks minimum)
• Projects that fit servicing calculators
• Clean compliance and consent histories

These requirements make perfect sense for their business model. But they create gaps for:

Property developers who need flexible funding structures Business owners with irregular cash flow from contract work Career professionals in transition between roles Portfolio owners needing strategic breathing room Anyone facing urgent deadlines banks can't meet

Alternative lending fills these gaps—not by lowering standards, but by assessing risk differently.

The 11 Lending Scenarios Where We Help

Below is your navigation hub to every lending solution we offer. Each scenario links to a detailed guide with case studies, eligibility criteria, and real-world examples.

Property & Development Lending

Business Working Capital

Residential & Personal Lending

How Luminate's Lending Process Works

Step 1: Initial Assessment (Same Day)

Contact us with your scenario. We'll assess feasibility within hours, not weeks.

We need to know:

• What you need funding for
• How much you need
• Your timeline
• Your exit strategy (how you'll repay)
• What security you can offer

Step 2: Formal Application (1-3 Days)

If we can help, we'll request:

• Financial information
• Security details (property valuations, contracts, etc.)
• Supporting documentation

We move fast because we understand time pressure.

Step 3: Approval & Structure (2-5 Days)

We assess based on:

• Quality of security
• Viability of your exit strategy
• Your ability to service the loan
• Overall risk profile

We structure loans creatively—first mortgages, second mortgages, mezzanine funding, or combinations.

Step 4: Settlement (3-10 Days from Approval)

For urgent situations, we can settle in days. Standard settlements take 1-2 weeks.

Total timeline: 1-3 weeks from first contact to funds (faster for emergencies)

Traditional Bank Timeline Comparison

Understanding Alternative Lending Costs

Let's be transparent: alternative lending costs more than bank lending. Here's why—and when it makes financial sense.

Why Rates Are Higher

Speed: We move in days, not months. That requires dedicated assessment resources.

Flexibility: We handle complex scenarios banks systematically decline. Higher risk requires higher returns.

Shorter Terms: Most of our loans are temporary solutions (6-24 months). We're not spreading costs over 25-year mortgages.

Specialised Assessment: Your scenario gets expert analysis, not just automated calculator inputs.

When Alternative Lending Makes Financial Sense

Scenario 1: Time Pressure You'll lose a $100,000 deposit if you can't settle in 7 days. A bank needs 4-6 weeks minimum. Paying 2-3% more in interest for 6 months ($1,500-2,000) vs. losing $100,000? Easy decision.

Scenario 2: Opportunity Cost You're a developer with a project that will generate $500,000 profit, but banks won't fund it because it doesn't fit their criteria. Paying higher interest on a 12-month construction loan costs you perhaps $30,000-50,000 extra. Not funding the project costs you $500,000 in profit.

Scenario 3: Strategic Timing You own a property portfolio. The market is soft right now. Selling under pressure might cost you $200,000 vs. waiting 12-18 months for better conditions. Higher interest costs for that period: $40,000-60,000. Net benefit: $140,000-160,000.

Cost Components

Note: Actual costs depend on loan size, term, security quality, and complexity.

Who We Are: Luminate Financial Group

We're New Zealand specialists in alternative lending solutions. While banks focus on standard scenarios, we focus on the complex, the urgent, and the non-traditional.

Our approach:

• Fast decisions: Days, not weeks
• Flexible structures: We craft solutions that fit your situation
• Clear communication: No jargon, no surprises
• Strategic thinking: We focus on your exit strategy, not just the loan
• Local expertise: We understand NZ property, business, and market conditions

We don't compete with banks. If you fit bank criteria and have time for their process, that's usually your best option. We're here for everything else.

Common Scenarios We Handle

"I found the perfect property but haven't sold my current home"

→ Residential bridge loan lets you buy now, sell strategically later

"My development project is solid but banks say it doesn't meet servicing"

→ Development funding structured to the project's merits, not just calculators

"I'm between executive roles with a signed contract but can't get a mortgage"

→ Employment transition loan with capitalised interest bridges the gap

"My childcare business has guaranteed government income but banks won't lend against it"

→ ECE contract funding treats your government contracts as the solid security they are

"I won a major contract but need working capital until payment arrives"

→ Contract-based lending funds you through the payment cycle

"My settlement deadline is in 5 days and the bank needs 4 weeks"

→ Emergency funding can settle in 3-7 days when you're out of time

"My property needs retrospective consents before banks will touch it"

→ Consent bridging funds you through the compliance process

"My loan facility expired and my lender won't extend"

→ Non-bank refinancing gives you breathing room or selldown time

Is Alternative Lending Right for Your Situation?

✅ Alternative Lending Works Well When:

• You have time pressure banks can't accommodate
• Your scenario is solid but doesn't fit standard criteria
• You need flexible loan structures (mezz, seconds, combinations)
• You have a clear exit strategy (sale, refinance, contract payment)
• The opportunity cost of not proceeding is high
• Traditional banks have declined for policy reasons (not credit issues)

⚠️ Alternative Lending May Not Be Right When:

• You have serious credit issues or history of defaults
• You have no clear path to repayment
• You have time to wait for bank approval and fit their criteria
• The security is poor quality or difficult to value
• You're looking for long-term, low-rate funding

How to Choose the Right Lending Solution

Use this decision tree to identify which loan type might suit your situation:

START HERE: What do you need funding for?

Property Purchase or Development?

↓ Do you need to buy before selling?

• YES → Residential Bridge Loan (Post 1)
• NO → Continue...

Is it a development project?

• YES → Are you in construction or selldown phase?
  • Construction → Property Development Funding
  • Selldown → Development Bridge Loan
• NO → Continue...

Does the property need consents/compliance work?

• YES → Retrospective Consent Funding
• NO → Continue...

Do you own multiple properties needing refinance?

• YES → Portfolio Refinancing

Business Working Capital?

↓ What's your business type?

• Childcare → ECE Contract Funding
• Other → Continue...

Why do you need working capital?

• Selling an asset soon → Asset Sale Bridging
• Large contract with delayed payment → Contract-Based Working Capital
• Current lender won't extend → Non-Bank Refinancing

Residential Mortgage?

↓ Are you currently employed?

• NO (but have confirmed new role) → Employment Transition Loan
• YES → Continue...

How urgent is your timeline?

• Days/immediate → Emergency Settlement Funding
• Weeks/months → Contact us to discuss

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Frequently Asked Questions

How quickly can you approve a loan?

For straightforward scenarios with clear security, we can provide indicative approval within 48 hours and formal approval within 3-5 days. Emergency situations can move faster—we've settled loans in 72 hours when necessary.

What security do you accept?

We primarily lend against NZ property (residential, commercial, development sites, land). We also consider:

• Business assets with clear valuations
• Contracts with creditworthy counterparties (government, large corporates)
• Plant and equipment (case-by-case)
• Portfolio combinations

Do you check credit history?

Yes, but we assess it differently than banks. We want to understand your credit history in context. Occasional late payments or resolved issues won't automatically disqualify you. We're looking for patterns of meeting obligations and your current capacity to service debt.

Can you lend if banks have already declined me?

Often, yes—but it depends on why they declined. If it's because:

• You don't fit their servicing calculators → We can likely help
• Your scenario is non-standard → We specialise in this
• You don't have continuous employment → We look at the full picture
• Your timeline is too tight → Speed is our strength

If they declined because of serious credit defaults, insolvency, or fraud—we probably can't help.

What's your typical interest rate?

Rates typically range from 8-15% per annum, depending on:

• Loan-to-value ratio (LVR)
• Quality and type of security
• Loan term
• Complexity of the scenario
• Your exit strategy

We provide exact rates in our formal proposal after assessing your specific situation.

Do you charge application fees?

We charge establishment fees (typically 1-3% of the loan amount) which cover assessment, due diligence, valuation, and documentation costs. We're transparent about all fees upfront—no hidden costs.

What's the maximum you'll lend?

We've funded loans from $50,000 to $10M+. Maximum loan amount depends on:

• Quality and value of security
• Your exit strategy
• Loan term
• Overall risk profile

For very large loans, we sometimes syndicate with other lenders to spread risk.

How do I repay the loan?

Most of our loans have these repayment structures:

• Interest-only during the term, with principal due at end
• Capitalised interest (added to loan balance, paid at end)
• Principal and interest for longer-term facilities

Your exit strategy might be:

• Property sale
• Refinance to a traditional bank
• Asset sale
• Contract payment
• Business sale

We focus heavily on exit strategy during assessment because we want you to succeed.

Can I repay early?

Most of our loans allow early repayment. Some have early repayment fees (typically 1-2%) to cover our cost of capital commitment. We disclose these in your loan agreement.

What if I can't repay on time?

Communication is key. If you're approaching your loan term and need more time:

1. Contact us early (don't wait until the last minute)
2. Explain what's changed and your revised exit strategy
3. We'll assess extension options

We want you to succeed. Extensions are often possible if the security remains solid and you have a credible plan. That said, we're not long-term lenders—our loans are designed as temporary solutions.

Do you lend nationwide?

Yes, we lend throughout New Zealand. Our head office is based in Auckland, but we assess and fund loans across the country.

What happens after I contact you?

1. Initial call/email: Brief discussion of your scenario
2. Preliminary assessment: We determine if we can help (usually same day)
3. Information gathering: If we can help, we'll request documentation
4. Formal assessment: Our team reviews everything (2-5 days)
5. Loan offer: If approved, we provide a detailed written offer
6. Acceptance & documentation: You review, sign agreements
7. Settlement: Funds transferred to your solicitor or directly

Total timeline: 1-3 weeks for standard scenarios, faster for emergencies.

Next Steps: Explore Your Scenario

Each of the 11 lending solutions below has a complete guide with:

• Real-world case studies
• Detailed eligibility criteria
• Cost breakdowns
• Application requirements
• FAQ specific to that loan type

Click through to the scenario that matches your situation:

1. Residential Bridge Loans → Buy before you sell
2. Property Development Funding → Outside bank servicing criteria
3. Development Bridge Loans → During selldown periods
4. Childcare Business Funding → Leverage ECE contracts
5. Asset Sale Bridging → Working capital while selling
6. Contract-Based Working Capital → Fund large project cash flow
7. Employment Transition Loans → Between jobs
8. Portfolio Refinancing → Buy time for strategic selldown
9. Non-Bank Refinancing → When lenders won't extend
10. Retrospective Consent Funding → For compliance work
11. Emergency Settlement Funding → When you're out of time

Not sure which applies? Contact us—we'll help you identify the right solution.

Ready to Explore Your Options?

Every situation is different. While this guide provides frameworks and examples, your specific scenario deserves individual assessment.

We offer no-obligation initial consultations to discuss:

• Whether alternative lending is right for your situation
• Which loan structure would work best
• Realistic timelines and costs
• Your path forward

Contact Luminate Financial Group:

📞 Call 0800 333 400
📧 Email askus@luminate.co.nz
🌐 Visit luminate.co.nz

Back to Alternative Lending Solutions Guide

Understanding your lending options is the first step toward solving complex financial challenges. Whether you're navigating property timing issues, business cash flow gaps, or urgent deadlines, Luminate Financial Group specialises in creating funding solutions when traditional banks can't help. Contact us to discuss how our alternative lending expertise can provide the strategic financing your situation requires.